House prices fell during the first three months of the year, with the average cost of a dwelling in the UK tumbling by more than £7,000 in April, according to the latest figures from Halifax.
The data provides further evidence of a housing market slowdown, revealing prices have plummeted by 3.1% between March and April 2018 and by 0.1% over the first quarter of the year.
What’s more there is evidence of low confidence among consumers, whose optimism in the market is at a five year low, said Halifax.
Annually, the price of the UK’s average house has increased. However the 2.2% growth seen this year is less buoyant than the 2.7% last year. The average price of a home in the UK is now £220,962.
Halifax’s data comes following a report revealing fewer homes had been sold between February and March and after as it was announced mortgage approvals had fallen in March.
Lucy Pendleton, founder director of independent estate agents, James Pendleton, said: “We’ve now witnessed three consecutive falls in quarterly figures, the amount of new consumer borrowing quite literally collapsed in March in an ominous sign of tightening purse strings, home sales are at a two-year low and the number of new instructions has fallen for the 25th month in a row.”
She added: “This slowing is already apparent across much of London where prices have already begun falling, but that has been good news.
“First-time buyers are celebrating a more sensible medium-term trajectory as they stand a greater chance of getting on the housing ladder while agents have been praying for price corrections as they know it’s the only way transaction levels will begin to recover.”
Halifax said its Housing Market Confidence Tracker revealed optimism in the housing market was at a five year low, however it said many consumers were more positive about growth going forward.
Meanwhile, Mike Scott, chief property analyst at Yopa, said it was important not to put too much weight on a single month’s data and pointed out the 3.1% fall in prices was partly the reversion of a big increase the previous month.
He added: “The Halifax numbers confirm other reports of a more general slowdown in the market, with fewer homes sold, fewer houses being put on the market, and a decline in consumer confidence.
“If this slowdown continues for the rest of the year, 2018 will turn out to be the least active year for the housing market since 2013.
“However, this would be unlikely to lead to a big fall in house prices, since mortgage rates remain low, mortgages remain available and supply is still tight.”
