The latest house price data from Halifax suggests the housing market has lost momentum as spring begins.
The pace of annual growth has eased to 0.8% from 1.2% the previous month, which Halifax head of mortgages Amanda Bryden says reflects wider uncertainty regarding the conflict in the Middle East.
She explained: “Concerns about higher energy prices have pushed up inflation expectations, which in turn led to a rise in mortgage rates, reducing confidence that interest rates will be cut this year and dampening the initial momentum in the market seen at the start of the year.
“Mortgage rates are a key factor for buyers, particularly those getting on the ladder for the first time, who are already balancing the challenge of saving a deposit, with the cost of borrowing. As a result, many are likely to watch movements in mortgage rates closely, before making a decision on any home purchase.”
The figures represent “an important intersection where we must clearly acknowledge future challenges ahead,” Propertymark CEO Nathan Emerson said.
“We started the year with positivity in terms of seeing an uplift in the average number of viewings per available property, coupled with general consumer positivity regarding affordability,” he explained.
“However, a lot has changed in a short space of time, with numerous sub 4% mortgage deals being withdrawn over the last few weeks as the wider economy adjusts to potential uncertainties.
“Inflation is expected to increase over the coming months and this is likely to have an immediate effect on consumer affordability. The rate of inflation will also play intense influence on the Bank of England regarding base rate decisions over the forthcoming months too. In addition, we are also due to see OFGEM make their next decision regarding energy price caps late next month, which again should be highly considered regarding household affordability as the year plays out.”
House prices continue to vary by region, with stronger growth in the North and more subdued conditions in the South. Northern Ireland continues to lead UK annual house price growth, with average prices up +8.7% over the past year to £224,809. Scotland also recorded strong growth, rising +4.4% annually to an average price of £222,716.
Wales saw a more modest increase of +1.6% on annual basis, taking the typical home value to £230,909. In England, stronger price growth remains concentrated in northern regions. The North East saw prices rise +5% over the year to £184,119, while the North West recorded annual growth of +3.1%, with the average home now costing £247,442.
By contrast, the southern markets continue to see prices ease. The South East led declines, with prices down -1.9% year‑on‑year to £383,573, while London saw average values fall by -1.2% to £536,751.
