UK house prices fell by -0.5% in March, a drop of ยฃ1,575. Despite this, according to the Halifax, the annual growth rate remained steady at +2.8%, with the typical UK property now valued at ยฃ296,699.
Amanda Bryden, Head of Mortgages, Halifax, said: “UK house prices fell by -0.5% in March, a drop of ยฃ1,575. Despite this, the annual growth rate remained steady at +2.8%, with the typical UK property now valued at ยฃ296,699.
โHouse prices rose in January as buyers rushed to beat the March stamp duty deadline. However, with those deals now completing, demand is returning to normal and new applications slowing. Our customers completed more house sales in March than in January and February combined, including the busiest single day on record. Following this burst of activity, house prices, which remain near record highs, unsurprisingly fell back last month.
โLooking ahead, potential buyers still face challenges from the new normal of higher borrowing costs, a limited supply of available properties to choose from, and an uncertain economic outlook.
โHowever, with further base rate cuts anticipated alongside positive wage growth, mortgage affordability should continue to improve gradually, and therefore we still expect a modest rise in house prices this year.”
Newspage asked property market experts for their views, below.
Riz Malik,ย Mortgage Brokerย and IFA atย R3 Wealthย commented: “Following market movements towards the end of last week as a result of Liberation Day, we could see some serious cuts in fixed rate pricing this week. If borrowing costs do come down, the house price decline looks set to reverse as market activity increases.”
Daniel Hobbs,ย CEOย atย New Leaf Distributionย commented: “With markets now betting the Bank of England will be cutting rates in May following the chaos in the markets caused by Trump’s Liberation Day speech, the property market could be set to benefit.
“Demand dropped off once the stamp duty deadline was effectively behind us based on this evidence but the direction of swap rates on Thursday and Friday could see things pick up quickly. Many brokers are expecting lenders to make a move and announce rate cuts this week. If that proves the case, demand could surge.
“Even aside from Trump, many first-time buyers are clambering to escape a rental market where prices are extortionately high and this looks set to continue.”
Katy Eatenton,ย Mortgage & Protection Specialistย atย Lifetime Wealth Managementย commented: “If we get a rate cut in May, which is looking much more likely after Trumpโs Liberation Day speech, demand could really start to go through the gears.
“Trump may be causing carnage in the markets but swap rates have fallen noticeably and this could translate into lower mortgage rates in the days and weeks ahead, stimulating demand. Many expected March to be a middling month as the rush to beat the stamp duty deadline subsided. In our experience, though, it was quite the opposite.
“First-time buyers have remained particularly active and are as keen as ever to escape the financial torment of the rental market. They know that getting onto the ladder still has value despite the fact that they may have missed out on savings.”
Ranald Mitchell,ย Directorย atย Charwin Mortgagesย commented: “After a sprinting start to the year, the housing market has paused for breath. March saw prices dip 0.5%, proof that even bricks and mortar need a breather. But with mortgage rates softening and pay packets rising, donโt be surprised if the market laces up for another jog later this year.”
Craig Fish,ย Directorย atย Lodestone Mortgages & Protectionย commented: “This is clear evidence that the stamp duty rush is over, but with Trumponomics wreaking havoc with financial markets around the world, we could be about to see a vast drop off in mortgage pricing. This, coupled with increasing wage packets, could see the housing market enter a boom period and the decline in house prices reverse.”
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