UK house prices have fallen for a second consecutive month, according to Halifax, as the conflict in the Middle East weighs on the housing market. The lender reported a 0.1% decline in April to £299,313, following a 0.5% drop in March, halving the annual rate of growth to 0.4% from 0.8%.
Amanda Bryden, head of mortgages at Halifax, attributed the slowdown to global developments stemming from the Iran war. “Higher energy prices have fed into inflation expectations, prompting markets to reassess the path for interest rates – a shift that has already pushed up borrowing costs for many buyers,” she said. The average two-year fixed mortgage rate rose to 5.77% in April, up from 4.83% at the start of March, while the five-year rate increased from 4.95% to 5.69%.
Before the Middle East conflict, the UK market had shown solid growth, with monthly price rises of 0.8% in January and 0.3% in February. However, the subsequent uncertainty has created a disconnect between buyers and sellers. Chris Hodgkinson of House Buyer Bureau noted: “Sellers are pricing based on expectation rather than current market reality, forcing larger reductions further down the line.”
In contrast, Nationwide reported a 3% annual rise in April, its strongest in 11 months, with prices climbing 0.4% month-on-month. The divergence reflects different measurement methodologies, with Nationwide recording four consecutive monthly increases. Despite this, Halifax’s data underscores the cautious mood among households facing rising living costs and higher mortgage rates.
