UK House Prices Hold Steady in April, reports Halifax
Discover the latest report from Halifax revealing that UK house prices have remained stable in April, despite higher mortgage rates affecting first-time buyers. Explore how flats are catching up to houses in the property market.
House prices in the UK remained stable in April, following a slight decline in March. According to the mortgage lender Halifax, the price of a typical home increased by less than £200 last month to £288,949, representing a 0.1% monthly gain. This comes after a 0.9% drop in March, which marked the first decrease in six months. On an annual basis, house prices rose by 1.1% in April, up from the previous month's rate of 0.4%. This increase can be attributed to weaker price growth during the same period last year, as reported by Halifax.
Despite the steady growth in house prices, first-time buyers are facing challenges due to higher mortgage rates. Mortgage approvals have reached their highest point in 18 months, indicating an improvement in market activity and demand. However, affordability remains a concern for first-time buyers and those coming off fixed-term mortgage deals. Mortgage rates have risen in recent weeks, reflecting expectations of a slower pace of interest rate cuts by the Bank of England. The average two-year fixed residential mortgage rate is currently at 5.93%, while the average five-year fix stands at 5.5%, according to Moneyfacts.
Looking ahead, if the anticipated downward moves in the Bank rate materialize later this year, fixed mortgage rates are expected to decrease. Combined with the resilience shown by the housing market in recent months, property prices are projected to rise modestly throughout 2024. Savills has revised its earlier forecast of a decline in UK house prices for this year, now predicting a 2.5% increase in 2024. While the market has experienced a slight slowdown in recent weeks, underlying confidence remains strong, providing buyers with opportunities to negotiate better deals.
In other news, UK construction output saw a notable increase in April, reaching its highest level in over a year. Despite a sluggish performance by housebuilders, the overall construction sector showed growth, with the purchasing managers index rising to 53.0 in April from 50.2 in March. This marks the highest level since February 2023, indicating growth in output across the commercial and civil engineering segments.
The UK housing market continues to show resilience, with modest price growth expected in the coming months. While challenges persist for first-time buyers, overall market confidence remains positive, supporting a favorable outlook for the property sector.
UK House Prices Hold Steady in April, reports Halifax
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