UK house prices edge down in May as Middle East fears weigh - Halifax

UK house prices edged down in May as uncertainty linked to developments in the Middle East continued to weigh on affordability and buyer confidence, according to data from mortgage lender Halifax on Friday.

The Halifax house price index showed average UK house prices edged down 0.1% in May to £298,806 from £299,251 in April. The monthly decline matched that recorded in April and was in line with the FXStreet-cited consensus.

Annual house price growth accelerated slightly to 0.5% in May from 0.4% in April.

Amanda Bryden, head of mortgages at Halifax, said property prices continued to reflect uncertainty linked to developments in the Middle East.

‘Despite recent cuts to mortgage rates, higher inflation expectations have kept borrowing costs above the level seen at the start of the year, continuing to stretch affordability for many buyers and temper demand,’ she said.

Bryden noted that overall market activity had remained resilient despite the more challenging backdrop.

According to HM Revenue & Customs data cited by Halifax, UK residential property transactions fell 3.0% in April to 101,030 from 103,910 in March. However, quarterly transactions were around 1.0% higher than in the preceding three months.

Meanwhile, Bank of England figures showed mortgage approvals for house purchases rose 3.1% in April to 65,945, the highest level since January 2025 and 9.0% above the level seen a year earlier.

Among first-time buyers, annual house price growth was more subdued at 0.3%, Halifax said, although lender support through more flexible affordability assessments and low-deposit mortgage products had helped support demand.

Regionally, Northern Ireland continued to record the strongest annual house price growth in the UK, with prices rising 7.8% to an average of £227,177.

Scotland posted annual growth of 3.8%, with the average home valued at £222,650.

In England, the strongest growth remained concentrated in northern regions. House prices in the North East increased 3.1% over the year to £181,703, while the North West recorded growth of 3.0% to £248,304.

By contrast, southern regions remained under pressure. House prices in the South East fell 2.1% annually to £382,704, while London prices declined 1.5% to £534,375.

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