According to figures from the Halifax, UK house prices have fallen in the last three months and are “stagnating”.
The three months to April saw prices fall by 0.2 per cent, which represents the first quarterly fall since November 2012.
The Halifax say that prices fell by 0.1 per cent in the last month.
Slightly more positively however, is the news that in the year to April prices rose by 3.8 per cent, with this figure remaining the same as it was for March. As a result of this, the average price of a flat or house in the UK remains £219,649.
Martin Ellis, the Halifax housing economist, said that the drop in house price growth is being caused by an increasing number of people being priced out of the market.
“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,” he said.
Recently, Nationwide said that house prices were growing at their slowest rate in four years, at only 2.6 per cent annually.
This followed reports from the Bank of England saying that the number of mortgage approvals had fallen for two consecutive months.
Samuel Tombs of Pantheon Macroeconomics said that the figures from the Halifax were more evidence of wage squeezes negating the impact of falling mortgage rates.
“House prices likely will continue to be underpinned by a shortage of supply, due to the high moving costs faced by existing homeowners. In addition, competition among lenders will continue to drive down mortgage rates this year, boosting the size of loans that some households can afford,” he said.
That view was echoed by Howard Archer at IHS Markit: “We suspect markedly weakening consumer fundamentals, likely mounting caution over making major spending decisions, and elevated house price to earnings ratios will weigh down further on housing market activity and house prices over the coming months.”
