With the UK officially in what has been described as the single worst national recession in the world, one agency has drawn on lessons from the past in a bid to ease fears amongst sellers and buyers.
London agency Benham and Reeves has looked at house price growth between April 2008 and June 2009 - a period of recession at the time of the global financial crisis - and found that overall, prices across the UK fell by 12.9 per cent.
The agency does not draw direct parallels, nor does it predict the same pattern of price falls as was the case over a decade ago, but it does seek to show light and shade - that some areas performed relatively strongly in difficult circumstances.
In 2008-9 Northern Ireland was hit the hardest with a decline of 23.9 per cent, while regionally the East of England saw a drop of 14 per cent with London down 13.8 per cent. Scotland saw the lowest impact on house prices, with an overall decline of just 5.2 per cent.
However, at local authority level, there were a total of five areas that actually saw house prices increase - in the Orkney Islands they jumped 21.7 per cent and in the Western Isles by 18.4 per cent. Powys in Wales saw an increase of 3.1 per cent, while Moray and the Scottish Highlands saw increases of 2.7 and 1.4 per cent respectively.
Scotland and Wales account for the majority of areas to have seen some of the most marginal declines in house prices.
Westminster was the area of London to fare best with a drop of some five per cent with Kensington and Chelsea, Wandsworth and the City of London also seeing prices fall by less than 10 per cent.
“News of a recession will no doubt bring another wave of doom and gloom from house price prophets but that simply isn’t what we’re seeing on the ground and with such a tidal wave of activity returning, it’s unlikely to materialise for many many months, if at all” insists Marc von Grundherr, director of Benham and Reeves.
“Of course, homebuyers would be forgiven for thinking twice given the recent figures from the Office for National Statistics, but as our research shows, a recession doesn’t necessarily mean a cataclysmic decline in property prices” he continues.
“In fact, some areas weathered the last recession pretty well considering the wider economic picture and the vast, vast majority of areas saw a quick recovery in property prices in the years that followed.
“For those investing now for the long-term, the value of their bricks and mortar investment should come good when they do come to sell. When you also consider the saving on offer with the current stamp duty holiday in some parts of the UK, now is a great time to get on the ladder."