By mid-2024, UK home prices are expected to decline by 15%

LONDON: British home prices appear to be headed for a 15% decline by the middle of 2024, according to economists at the Japanese bank Nomura. This decline will be more pronounced than other forecasters had anticipated. (Reported by news source)

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As interest rates reached fresh 15-year highs in recent months, mortgage approvals fell precipitously.

For the ratio of rising monthly interest payments to tight wages to return to normal levels, Nomura said property prices are likely to need to decline by between 10% and 20% from the peak they achieved last year.

According to over 100 housing market analysts surveyed by Reuters last month, home prices in the majority of major real estate areas will decline in 2023. The estimate called for a 4.7% decline in British home values in 2023 and a 10% decline from the peak to the trough.

House price declines, according to Nomura, will affect the Bank of England's monetary policy. Nomura predicts that the Bank Rate for the BoE would increase to 4.25% this year from its current level of 3.5% before declining to about 3.5% by the middle of next year.