- Annual house price growth slowed to 0.4% in April, from 0.8% in March (source: House Price Index | Halifax)
- Prices edged down 0.1% in the month
- The average house now costs £299,313
Sarah Coles, head of personal finance at AJ Bell, comments:
“It takes a lot to shake the faith of a nation of property lovers, but the Iran war has taken a serious toll. It has affected everything from consumer confidence to mortgage rates, pushing house prices lower for the second consecutive month. Property values are still up over the past year, but only fractionally.
“Buyers weren’t swayed by increased property affordability, as pay rises continued to outstrip house price rises. They weren’t persuaded by cuts in mortgage rates during the month, because deals remained more expensive than before the outbreak of war. Figures from RICS show buyer demand dropped substantially in both February and March, and agreed sales were falling too.
“Falling prices could take some of the urgency out of the property buying process, alleviating concerns that prices could rise out of reach if you don’t move fast enough. It means you have the time to build a property deposit that makes your monthly payments manageable. If you have a Lifetime ISA, you could consider making the most of this year’s allowance, so the government bonus makes your home more affordable. If you have time on your side, then it could also be an opportunity to invest using your Lifetime ISA, so this money works even harder.
“If you’re considering pausing a purchase in the hope that prices keep dropping, it’s worth bearing in mind that future movements in the market are never guaranteed. While prices have fallen this month, the Bank of England figures show mortgage approvals for purchases rose in February and March, so we could still see this feed through into an uptick in buyers and rising prices again.”
