UK house prices fall for third month amid Iran war uncertainty, Halifax reports
11 reported
UK house prices fell unexpectedly in May, marking the third consecutive monthly decline, according to a report from lender Halifax. The average price of a typical UK home dropped by 0.1% to £298,806, while analysts had forecast a 0.1% rise. Halifax attributed the decline to rising mortgage rates fueled by the war in Iran, which has affected affordability and homebuyer demand. On an annual basis, house prices grew by 0.5%, up slightly from 0.4% in April but below analysts’ expectations of 1% growth. Mortgage rates have risen since March, with the average two-year fixed rate at 5.66% and the five-year fixed rate at 5.62% as of Thursday. Industry figures noted a buyers’ market with ample stock, though first-time buyer activity was described as subdued. UK inflation slowed to 2.8% in April, but economists expect it to rise in coming months due to a 13% increase in the household energy price cap from July.
What’s reported
UK house prices fell 0.1% in May to £298,806, the third consecutive monthly drop recorded by Halifax.
Analysts had forecast a 0.1% rise for May.
Monthly falls were 0.1% in April and 0.5% in March.
Annual house price growth was 0.5% in May, up from 0.4% in April but below the 1% forecast.
Amanda Bryden, head of mortgages at Halifax, said property price trends reflect uncertainty linked to Middle East developments.
The average two-year fixed mortgage rate was 5.66% on Thursday, up from 4.83% at the start of March.
The average five-year fixed mortgage rate was 5.62%, up from 4.95%.
Jason Tebb of OnTheMarket described the market as the strongest buyers’ market in many years.
UK inflation slowed to 2.8% in April, the lowest rate in more than a year.
The household energy price cap will rise 13% from July to £1,850 a year.
Nationwide reported its first fall in monthly house prices this year in May, using a different methodology.
Key figures
Amanda Bryden, head of mortgages at Halifax
Jason Tebb, president of OnTheMarket
Amy Reynolds, head of sales at Antony Roberts
Sources: The Guardian
