Halifax customers woke up to a £296 blow on Friday morning as the lender reported a 0.1% drop in average house prices in April. The typical property now costs £299,313, down from £299,609 in March, according to the latest Halifax House Price Index.
Annual Growth Slows
Annual house price growth slowed to 0.4% in April, compared with 0.8% in March. Northern Ireland continues to lead the UK with the strongest annual growth at 7.6%. Halifax, which has branches in Birmingham, noted that the housing market is showing resilience despite global uncertainties.
Expert Commentary
Amanda Bryden, Head of Mortgages at Halifax, said: "Average house prices showed little movement in April, edging down by just -0.1% compared to March, with the typical property now costing £299,313. The pace of annual growth also eased to +0.4%. After a strong start to the year, recent global developments have added a greater degree of uncertainty to the outlook."
Bryden added: "In particular, higher energy prices have fed into inflation expectations, prompting markets to reassess the path for interest rates – a shift that has already pushed up borrowing costs for many buyers. This understandably leads to more caution among some households, with the cost-of-living once again front of mind and extra thought being given to planned property moves."
Market Resilience
Despite the dip, Bryden highlighted the housing market's resilience: "Even so, the housing market continues to display the resilience that has been its hallmark in recent years. While activity is likely to cool in the near term, the underlying picture remains one of relative stability, supported by wage growth that continues to outpace house price inflation."
She also noted that most existing homeowners are on fixed-rate mortgages, insulating them from short-term interest rate changes. "A slower pace of house price growth may be disappointing news for existing homeowners. However, for those looking to step onto the property ladder, stable prices are helpful, even if higher mortgage rates mean affordability remains stretched."
First-Time Buyers
The average price paid by first-time buyers has fallen slightly to £238,908, its lowest level so far this year, offering some relief for those entering the market.
