UK house prices fell for the first time since June 2021

UK house prices fell in July for the first time in more than a year after Britain’s biggest lender warned of higher interest rates and the impact of a cost-of-living crisis.

The average price of a house last month was £293,221, down 0.1%. It was the first decline since June last year, according to the latest report from Halifax.

The annual growth rate also fell marginally from 12.5% ​​to 11.8%. At the same time last year , house prices were £30,000 higher than now .

We don’t read too much into any single month. A slowdown in annual house price growth has been expected for some time, particularly as the fall has been fragmented,” said Russell Galley, managing director of Halifax.

Leading indicators of the housing market have shown activity softening recently. With rising borrowing costs adding to the squeeze on household budgets.”

However, Galley says some of the factors driving the housing market’s red-hot growth through the coronavirus pandemic remain . Galley said there are still factors to consider, such as the money saved during the lockdown and the hunt for more rural locations and spacious homes with the advent of flexible and remote working practices.

“Looking forward, it’s likely that home prices will come under more pressure as market headwinds fade further and interest rates rise and the cost of living increases further,” Galley said.

“Therefore, a slowdown in annual house price inflation still appears to be the most likely scenario.

The Bank of England on Thursday announced the biggest interest rate hike in 27 years to help curb rising UK energy bills and gas prices this winter. The 0.5% to 1.75% increase would take UK interest rates to a 13-year high and the sixth consecutive rise.

UK house prices from around the country

Annual house price inflation in Wales was the strongest at 14.7%, with the average house costing £222,639 Halifax said.

This is closely followed by South – West of England, which has seen annual house price inflation increase by 14.3%, with an average property costing £310,846.

In Scotland, the average house cost £203,677, which slowed slightly from 9.9% to 9.6% . In Northern Ireland, Annual house price inflation has been reduced to 14% and the average house price is £187,102.

Greater London recorded the slowest annual house price growth of any region in the UK at 7.9%. However, the average property cost is £551,777, the highest across the country.

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