UK house prices set to stagnate in 2023, improving affordability for buyers

House prices in the UK are forecast to stagnate or fall slightly in 2023, improving affordability. This could help more people buy homes.

Wages are expected to keep rising over the next few years while house prices remain flat, leading to the longest stretch of improving affordability since 2000.

House prices fell less than expected in 2022 due to low supply and stabilizing mortgage rates. A further small drop of 0-4% is forecast for 2023.

Improving affordability is welcome news for younger voters struggling to buy homes. The government is considering measures to help more people buy.

Mortgage rates shot up in 2022 and remain far above 2021 lows. But further rate cuts could come in 2024 if inflation keeps falling.