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UK house prices fell 3.1% last month

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Monthly and quarterly measures now show a fall in average prices, while the annual rise has dropped back to 2.2%
UK house prices fell 3.1% last month

UK house prices fell by 3.1% in April, taking the average property price to £220,962, according to Halifax.

The lender also noted that the quarterly measure of house price inflation – which is usually less volatile than the monthly figure – also shows a fall of 0.1%.

Annual house price inflation across the UK is still positive at 2.2%, but this too has fallen back from 2.7% in March.

Russell Galley, managing director of Halifax, said: “Both the quarterly and annual rates have fallen since reaching a recent peak last autumn, with these measures providing a more stable indication of the underlying trend than the monthly change.

“Housing demand has softened in the early months of 2018, with both mortgage approvals and completed home sales edging down. Housing supply – as measured by the stock of homes for sale and new instructions – is also still very low.

“However, the UK labour market is performing strongly with unemployment continuing to fall and wage growth finally picking up. These factors should help to ease pressure on household finances and as a result we expect annual price growth will remain in our forecast range of 0-3% this year.”

But Lucy Pendleton, founder director of independent estate agents James Pendleton, was less optimistic: “This sudden batting collapse in the monthly figures has knocked more than £7,000 off the price of the average home as the market continues to be starved of life,” she said.

“It’s true that monthly figures are more volatile but you mustn’t ignore the body of evidence that surrounds them either.

“We’ve now witnessed three consecutive falls in the quarterly figures, the amount of new consumer borrowing quite literally collapsed in March in an ominous sign of tightening purse strings, home sales are at a two-year low and the number of new instructions has fallen for the 25th month in a row.

“Short-term volatility can be ignored to a certain extent, but less so when it confirms what a great many other indicators are telling you.”

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