According to the latest Halifax House Price Index, annual basis house prices rose for the sixth month in a row, increasing by 1.5% compared to 1.1% in April. The average UK house price now stands at £288,688.
The report also shows that house prices remained mostly static in May, falling by -0.1%, which is equivalent to £170 in cash terms.
Amanda Bryden, Head of Mortgages at Halifax, said: “Market activity remained resilient throughout the spring months, supported by strong nominal wage growth and some evidence of an improvement in confidence about the economic outlook. This has been reflected in a broadly stable picture in terms of property price movements, with the average cost of a property little changed over the last three months.
She added: “A period of relative stability in both house prices and interest rates should give a degree of confidence to both buyers and sellers. While homebuyers and those remortgaging will continue to respond to changes in borrowing costs, set against a backdrop of a limited supply of available properties, the market is unlikely to see huge fluctuations in the near term.”
Similar sentiments were shared by Iain McKenzie, Chief Executive of Guild of Property Professionals: “After seeing some volatility in house prices in the spring, it is reassuring to buyers and sellers alike that stability is returning to the market.
“There is now pent-up demand, particularly among first-time buyers who might be sitting on a deposit and waiting for interest rates to fall.
McKenzie continued: “Our members are seeing this on the ground, with transactions at their highest levels since early 2023. There has since been a rise in the number of properties on the market, and it’s likely that some buyers had been waiting for better mortgage offers to arrive.
“This elevated supply of housing has provided more choice for buyers, potentially lessening the urgency to buy quickly. Estate agents are reporting a more balanced market where buyers have more negotiating power.”
Fine & Country Managing Director, Nicky Stevenson, also commented: “While this might not be welcome news for buyers – especially first-timers – an anticipated interest rate cut this summer could provide some relief in the coming months.
“All eyes are on the Bank of England to finally drop the base rate from its current 5.25%, where it has remained since September.”
