But the number of sales going through will remain buoyant for a range of structural, demographic and economic factors.
The spike in mortgage rates after the mini-budget in late September has led to a sharp reduction in housing market activity, more pronounced in new buyer demand than sales agreed.
Demand has fallen to levels normally associated with Christmas as new buyers sit on the side-lines, watching the outlook for mortgage rates and what the economic headwinds means for jobs and incomes.
New buyer demand is almost half the level a year ago when market conditions were stronger, mortgage rates lower and there were fewer cost-of-living pressures on household budgets.
Mini-budget fallout hits demand (-44%) more than new sales (-28%)
New sales fell by half in the hottest markets, less in affordable areas
Lower sales and new supply are boosting sales inventory. Ongoing scarcity expected to remain in 2023 limiting the downside for prices
House price inflation losing momentum at speed – but no price falls recorded over the last quarter in any region or major city
Discount to asking price on new sales widens in recent weeks • Widespread repricing of homes underway, albeit modest in size
Diverse range of need-driven factors expected to support sales volumes with mortgage rates set to start 2023 at 5% level