29 July 2024

House prices in Wales rise after five quarters of consecutive decline

The average price of a home in Wales has risen to £236,369 in the second quarter of 2024, making this the first time that prices have increased since December 2022, when the peak average price of £249,000 was recorded.

The figures have been released from Principality Building Society’s Wales House Price Index for Q2 2024 (April-June), which demonstrates the rise and fall in house prices in each of the 22 local authorities in Wales.

Principality’s report shows the average house price in Wales has risen by 3.1% since last quarter, driven by the majority of local authorities reporting higher prices in Q2 for the first time since 2022.

The average price of a home in Wales is still down 2.4% when compared to the same period the previous year and 5% below the peak price of £249,000.

Shaun Middleton, Head of Distribution at Principality Building Society, said: “The second quarter of 2024 has brought much-needed positive news to the Welsh housing market. After five consecutive quarters of declining house prices, we are now seeing a recovery.

“The picture across Wales shows that local authorities have been reporting quarterly price increases, rather than decreases, for the first time since 2022, translating into a steady rise in house prices.”

Across Wales, 15 out of 22 local authorities reported price rises when compared to the previous quarter, with Bridgend and Ceredigion recording double-digit increases of more than 16%. Year-on-year, 11 local authorities still reported declines, with Wrexham experiencing the biggest drop of 10% when compared to the same period the previous year.

There were 10,200 transactions in Wales in the second quarter of 2024, 24% more than in the first quarter and 16% up on the same period a year ago. This represents an area of growth, as quarterly transactions have continuously declined since late 2021.

In a recent survey, 66% of Principality’s members reflected that the type of home and its size are the two most important factors when looking for a home, with the detached house a preference for many buyers.

As such, with transactions increasing this quarter, detached houses are seeing a small resurgence, however this recovery is still weaker than flats, where transactions are up a third both on the quarter and the year earlier, reflecting affordability pressures elsewhere in the market.

Shaun continued: This increase, bringing the average price to £236,369 in Wales, marks a significant turnaround and suggests that the market may be stabilising. The last few years have marked the most challenging housing market conditions since the Global Financial Crisis in 2008, with first-time buyers encountering the toughest conditions in about 70 years, according to the Building Societies Association. 

Looking ahead, the new UK Labour Government are moving forward with a significant legislative move aimed at accelerating the development of infrastructure and the construction of 1.5 million homes in England, meanwhile the Welsh Government has committed to deliver 20,000 new low-carbon homes for rent within the social sector during the current term. 

Together with our insight, this suggests that the second quarter may well represent a new dawn for the housing market in Wales, as we expect house prices to increase, with a higher volume of transactions, supported by better economic conditions, increased affordability and growing buyer interest.”

Principality Building Society, a mutual organisation which is owned by customers and not shareholders, aims to support and build a new generation of savers and home owners. For more information go to: www.principality.co.uk/mortgages/house-price-index.

Published: 29/07/2024