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Home»UK Property Finance»UK house prices ‘plateauing’ due to rising mortgage rates
UK Property Finance

UK house prices ‘plateauing’ due to rising mortgage rates

May 7, 20245 Mins Read


There has been no spring bounce for UK house prices, the latest Halifax House Price Index (HPI) finds.

Property price inflation remained relatively static in April, with average prices rising just 0.1% (£168) month-on-month. On an annual basis, prices were up 1.1% but the lender put this down to the weak housing market performance it recorded in April 2023.

Halifax blamed the lack of growth on what’s happening to mortgage rates. With interest rates frozen at a 16-year high, lenders – including Halifax – have been increasing their rates on short-term fixed deals. We will find out the next Bank of England interest rate decision later this week.

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These findings are similar to those of the Nationwide HPI, which also blamed expensive mortgages for the stagnation in the housing market. Against this challenging backdrop, Halifax has found buyers are opting for smaller homes in a bid to make up for affordability constraints.

UK house prices continue to see North-South divide, Halifax finds

According to Halifax’s latest analysis of the UK housing market, the average home cost £288,949 in April – up £168 compared to March and just £1,700 (0.6%) higher than at the start of 2024. Year-on-year, house prices are more than £3,000 more expensive.

The biggest growth was registered in Northern Ireland, where prices went up 3.4% on average to £192,502. However, Halifax pointed out that this was a slowdown on the previous month’s growth rate of 4.1%.

In England, the North-South divide registered by other HPIs continued to be a factor in Halifax’s data. The North West registered the highest rate of annual price inflation, growing 3.3% to £231,599. At the other end of the scale, homes in Eastern England posted a 1.1% price drop compared to April 2023. This £3,500 fall meant the average property cost £329,723 in April.