UK house prices fell in August, according to new figures, as higher interest rates and oil prices weighed on the market. The average house price dropped by 0.5% month on month, the first decline since January, with the annual growth rate slowing to 2.1%.
Market Pressures
The decline comes as the Bank of England's recent rate hikes continue to affect affordability, while rising oil prices have added to inflationary pressures. Analysts noted that the housing market is showing signs of cooling after a period of strong growth.
Data from mortgage lender Halifax showed that the average UK house price now stands at £288,000, down from £289,000 in July. The annual rate of growth has slowed from 2.8% in July, reflecting the impact of higher borrowing costs.
Regional Variations
Regionally, the South East of England saw the largest monthly fall, with prices dropping by 1.2%, while the North West bucked the trend with a 0.4% increase. London prices fell by 0.8% month on month.
Halifax's head of mortgages, Amanda Bryden, said: "The housing market is feeling the effects of higher interest rates, and we expect further modest falls in the coming months."
Outlook
Economists expect the Bank of England to hold rates steady at its next meeting, but oil price volatility could influence future decisions. The housing market is likely to remain subdued as affordability pressures persist.
