A slight increase in property prices was seen last month by Halifax, despite sellers being more cautious and buyer demand being down
UK house prices went up in October for the first time in six months, according to Halifax. The lender says average house prices rose by 1.1% last month, compared to a fall of 0.3% in September. Property prices have dropped annually by 3.2% compared to a drop of 4.5% last month.
The average UK home now costs £281,974 – up by around £3000 compared to last month, says Halifax.
‘UK house prices rose in October, up by 1.1% on a monthly basis, breaking a run of six consecutive monthly falls,’ says Kim Kinnaird, Director Halifax Mortgages. ‘On an annual basis, prices are down 3.2%, though the decline was at a slower pace than we saw in September.’
Cautious vendors
Kinnaird adds: ‘Prospective sellers appear to be taking a cautious attitude, leading to a low supply of homes for sale. This is likely to have strengthened prices in the short term rather than prices being driven by buyer demand, which remains weak overall. While many people have seen their income grow through wage rises, higher interest rates and wider affordability pressures continue to be challenges for buyers.’
Halifax says it anticipates that house prices will continue to fall further because the Bank of England is unlikely to reduce the base rate anytime soon. It claims that prices should start to grow again in 2025.
The first-time buyer market has also proven to be resilient, according to the lender. Despite less overall buyer demand, first-time home prices are down by 2.4% annually, a smaller fall than the market in general (3.2%).
Annual house price changes
Annually, all UK nations and regions have seen house prices decline. The highest fall was in South East England, where prices dropped by 6% over the last year. Scotland showed the most resilience, with prices dropping by just 0.2% annually. Northern Ireland saw a decline of 0.5% and Wales by 3.9%.
‘On average, prices remain around £40,000 above pre-pandemic levels,’ concludes Kinnaird.