According to new data from Halifax, house prices rose by just 0.1 per cent in both London and the UK in April.
The average house price is now £539,336 in London. The Halifax House Price Index found that this is nearly double the average price in the UK of £288,949.
According to the lender’s data, this is the first month of the year house prices have risen. While overall data on the market has been mixed so far this year, according to Halifax’s data, prices have been falling for the year, with April being the first month to show growth.
“While there is always much scrutiny of monthly price changes – and a degree of volatility is to be expected given current market conditions – the reality is that average house prices have largely plateaued in the early part of 2024,” Head of Mortgages at Halifax, Amanda Bryden, said.
Annual growth in house prices across the UK rose to 1.1 per cent, from 0.4 per cent, although this may be due to the effect of weak growth in April 2023, Halifax said.
The value of flats has risen more quickly than larger houses as buyers compensate for higher borrowing costs by targeting smaller properties.
“While borrowing costs remain more expensive than a few years ago, homebuyers are gaining confidence from a period of relative stability. Activity and demand is improving, evidenced by greater numbers of mortgage applications so far this year,” Bryden said.
Recent figures showed mortgage approvals have reached their highest point in 18 months that’s despite the fact that the Bank of England’s base rate has been held at 5.25 per cent since last August.
“We can’t overlook the fact that affordability constraints are still a significant challenge, for both new buyers and those rolling off fixed-term deals.
“If, as is still expected, downward moves in Bank Rate come into play later this year, fixed mortgage rates should fall. Combined with the resilience displayed by the housing market over recent months, we now expect property prices to rise modestly over the course of 2024,” Bryden said.