Halifax has said that the typical property values fell by £2,900 month on month in March by 1.0% after they rose in February by 0.3%.
Kim Kinnaird, director of Halifax Mortgages, said: “Compared to last month, the price of a UK property fell 1.0% or £2,908 in cash terms, with the average property now costing £288,430.
“That a monthly fall should occur following five consecutive months of growth is not entirely unexpected, particularly in view of the reset the market has been going through since interest rates began to rise sharply in 2022.
“Despite this, house prices have shown surprising resilience in the face of significantly higher borrowing costs.
“Affordability constraints continue to be a challenge for prospective buyers while existing homeowners on cheaper fixed-term deals are yet to feel the full effect of higher interest rates.
“This means the housing market is still to fully adjust, with sellers likely to be pricing their properties accordingly.”
She continued: “Taking a slightly longer-term view, prices haven’t changed much over the past couple of years, moving in a narrow range since the spring of 2022, and are still almost £50,000 above pre-pandemic levels.
“Looking ahead, that trend is likely to continue. Underlying demand is positive, as greater numbers of people buy homes, demonstrated by recent rises in mortgage approvals across the industry and underpinned by a strong labour market.”
Foxtons CEO, Guy Gittins, said, “House prices have continued to creep up since the start of the year and this improvement in market health has been driven by the returning appetite of UK homebuyers.
“While higher mortgage rates certainly remain an obstacle, there has been a dramatic increase in buyer activity levels and it’s not just in the form of enquiries and viewings, with more offers also being made.
“With the general expectation that interest rates are set to fall sooner rather than later, we anticipate that market conditions will only continue to improve as buyer confidence builds.”
Director of Benham and Reeves, Marc von Grundherr, added, “It’s clear that nation’s homebuyers are marching on, determined to realise their aspirations of homeownership in 2024, regardless of higher mortgage rates and a lack of any government offered incentives.
“This determination has already had a positive impact on the UK property market and we’ve started the year with a far greater degree of market stability than we’ve seen in recent months, with conditions only likely to improve as the year progresses.”
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