House price growth in the UK has halved as the ongoing Middle East conflict begins to impact mortgage costs and inflation expectations, according to lender Halifax. Annual house price growth slowed to 0.4% in April, down from 0.8% in March, with average prices falling 0.1% month-on-month to £299,313.
Impact of Global Uncertainty
Amanda Bryden, head of mortgages at Halifax, attributed the slowdown to recent global developments, particularly higher energy prices feeding into inflation expectations. This has prompted markets to reassess interest rate paths, pushing up borrowing costs for many buyers. "This understandably leads to more caution among some households, with the cost of living once again front of mind," she said.
Critics have pointed to US President Donald Trump's military actions in Iran as a key factor driving up energy prices and, consequently, mortgage costs. The conflict has introduced significant uncertainty into the housing market.
Regional Variations
Northern Ireland continues to lead annual house price growth with a 7.6% increase, followed by Scotland at 4.0%. In England, the North East saw prices rise 4.5% year-on-year, while the North West recorded 3.4% growth. However, southern regions experienced declines, with London falling 1.4% and the South East dropping 2.0%.
Wales saw modest growth of 0.7%, while the East of England and South West recorded annual declines of 0.7% and 1.1%, respectively.
Expert Opinions
Sarah Coles, head of personal finance at AJ Bell, cautioned against pausing purchases in hopes of further price drops, noting that mortgage approvals rose in February and March, which could lead to an uptick in buyers and prices. Karen Noye, mortgage expert at Quilter, advised borrowers not to try to time the market but to review options early and be ready to act if lenders reprice.
Mark Harris of SPF Private Clients said first-time buyers should be encouraged by steady prices, while Nathan Emerson of Propertymark warned of potential base rate increases by the Bank of England, which could cause anxiety for those with tracker mortgages or expiring deals.
Average House Prices by Region
- East Midlands: £246,997 (0.6% annual change)
- Eastern England: £333,457 (-0.7%)
- London: £536,051 (-1.4%)
- North East: £183,445 (4.5%)
- North West: £248,945 (3.4%)
- Northern Ireland: £224,851 (7.6%)
- Scotland: £222,448 (4.0%)
- South East: £383,044 (-2.0%)
- South West: £300,758 (-1.1%)
- Wales: £230,952 (0.7%)
- West Midlands: £265,713 (2.0%)
- Yorkshire and the Humber: £216,915 (1.0%)
