UK house prices have paused in the lead-up to next month's General Election, down just -0.1% on a monthly basis.
The latest data released by Halifax this morning has revealed that the price of a typical UK home average remained static in May, edging down by 0.1% from the previous month to £288,688 (compared to £288,862 in April)
The annual rate of house price growth climbed to +1.5% during May, a small rise from +1.1% seen the month before.
National and regional breakdown
According to the figures, the North West is the strongest performing nation or region in the UK, where house prices grew by 3.8% on an annual basis in May. The average price of a property in the North West now stands at £232,258.
Northern Ireland's housing market remains strong, with growth up +3.2% in May, pulling back slightly from +3.3% in April.
House prices in Scotland also increased, with a typical property now costing £204,952, +1.9% more than the year before. In Wales, house prices grew annually by +0.7% to £219,483 (vs +1.1% in April).
Eastern England recorded the largest decline in annual growth across the UK. House prices here now average £329,853, down -0.8% in May.
Unsurprisingly, London continues to have the most expensive average price tag, now at £536,821, up marginally (+0.2%) compared to last year.
Amanda Bryden, Head of Mortgages, Halifax, said: “UK house prices were largely static in May, edging down slightly by -0.1% or around £170 in cash terms.
"On an annual basis, house prices rose for a sixth consecutive month, up by +1.5% vs +1.1% in April. The average property price now stands at £288,688.
“Market activity remained resilient throughout the spring months, supported by strong nominal wage growth and some evidence of an improvement in confidence about the economic outlook. This has been reflected in a broadly stable picture in terms of property price movements, with the average cost of a property little changed over the last three months.
“A period of relative stability in both house prices and interest rates should give a degree of confidence to both buyers and sellers. While homebuyers and those remortgaging will continue to respond to changes in borrowing costs, set against a backdrop of a limited supply of available properties, the market is unlikely to see huge fluctuations in the near term.”
"Demand will typically rise in spring but there has been a 0.3% price decline over the last three months thanks to stubborn services inflation and rising swap rates. There should be a more noticeable bounce this autumn when the first rate cut since March 2020 is likely to have happened and the political backdrop will have stabilised.
"We expect UK prices to rise by 3% this year as the prospect of more mortgages starting with a ‘3’ gets closer.”
Nathan Emerson CEO at Propertymark comments: “The housing market seems to be generally moving in the right direction, with house prices going up annually from this time last year.
"With a general election now on the horizon, there may be potential caution from buyers and sellers, especially those hoping to step onto the housing ladder for the first time, as they await any announcements regarding government support. People will also be carefully awaiting the Bank of England’s next announcement this month.”
Amy Reynolds, head of sales at Richmond estate agency Antony Roberts, says: “Even the prospect of an imminent general election is not deterring buyers and sellers. Our offices are buy, with plenty of viewings and an increase in offers as the weather improves.
“That said, continued uncertainty as to when interest rates might start coming down and the cost of living is leading to some caution, properties spending longer on the market and harder price negotiations.
“First-time buyers in particular are finding it difficult to raise deposits and are relying on the Bank of Mum and Dad more than ever to buy, especially in London. Some stabilising of prices will be welcomed by them in particular."
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: “With the ECB making its move first and cutting rates this week, all eyes are on the Bank of England to see whether it will do similar at its June meeting. However, the timing of the general election has somewhat dashed those hopes, with an August cut at the earliest seeming most likely.
“Swap rates sharply increased earlier this week but have settled down. Should that volatility dissipate and Swaps fall, lenders could return to the market with more attractive rates. In the meantime, several lenders are on withdrawal watch so borrowers who see a rate they like the look of would be wise to secure it to protect themselves from further price fluctuations in the short term.
“The housing market continues to demonstrate resilience as borrowers adjust to the loss of rock-bottom rates and get on with their moves. Mortgage approvals paint a rosier picture, rising year-on-year and are encouraging for the market as the year progresses."