First quarterly fall in UK house prices for four and a half years
House prices in the three months to April were 0.2% lower than in the preceding quarter, according to figures released by Halifax.
This is the first time there’s been a decline in the quarterly house price rate since 2012.
Prices also fell back slightly (0.1%) between March and April, while the annual rate of growth for the first quarter of the year was 3.8%, the lowest it’s been for four years.
The average UK property price in April was £219,649.
Martin Ellis, housing economist at Halifax, said: “House prices have stagnated over the past three months. Housing demand appears to have been curbed in recent months due to a deterioration in housing affordability driven by the sustained period of rapid house price growth during 2014-16.
“Signs of a decline in the pace of job creation, and the beginnings of a squeeze on households’ finances as a result of increasing inflation, may also be constraining the demand for homes.”
Jonathan Samuels, CEO of specialist property lender, Octane Capital, added that prices are likely to remain flat: “Rising inflation is without doubt hitting demand for property, as prospective buyers start to feel the pinch.
“But there are other forces at play. The property market is experiencing an affordability hangover from the price growth of recent years, while ongoing Brexit negotiations and cross-Channel spats are also creating uncertainty.
“Combine the rising cost of living with muted wage growth, add in political and economic uncertainty, and a period of prolonged house price stagnation is a real possibility.
“With the General Election approaching, it’s hard to see any material uplift in activity until the Autumn. A lot is riding on the direction of inflation.”