According to seasonally adjusted figures released from the Halifax, the annual 3.8% rise in UK house prices recorded in the three months to April is equivalent to the annual growth of 3.8% seen in the three months to March, indicating that house price growth has lost momentum.
The Halifax House Price Index also revealed that house prices in the three months to April were 0.2% lower than the quarter before: the first quarterly drop in prices for over four years. On a monthly basis, a drop of 0.1% was recorded between March and April.
The average cost of a house or flat is now £219,649.
Discussing the latest figures, Martin Ellis, Halifax housing economist said: “House prices have stagnated over the past three months. The annual rate of growth remained at 3.8% in April, the lowest rate since May 2013.
“Housing demand appears to have been curbed in recent months due to the deterioration in housing affordability caused by a sustained period of rapid house price growth during 2014-16.
“Signs of a decline in the pace of job creation, and the beginnings of a squeeze on households’ finances as a result of increasing inflation, may also be constraining the demand for homes.
“Continuing very low mortgage rates, together with an ongoing acute shortage of properties for sale, should nonetheless underpin house prices over the coming months.”
Jeremy Duncombe, Legal & General Mortgage Club director said: “Today’s reduction in momentum for house price inflation is not necessary a bad sign for our housing market. It is all too easy to become preoccupied with these monthly fluctuations but what remains unchanged is the staggering gap between house price inflation and wage inflation.
“With the General Election on the horizon, it is important that the progress our current Government has made with the Housing White Paper does not fall down the priority list. Whatever the outcome, tackling our nation’s housing shortage needs to be at the top of the agenda for all political parties. The General Election provides the perfect opportunity for the successful party to truly make their mark and restructure of housing market once and for all.”
Fellow lender, Nationwide, reported last week that at 2.6% annually, housing prices were rising at their lowest rate in four years.
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