The UK housing market remained broadly steady in May, despite a slight monthly dip in prices. According to the latest Halifax House Price Index, average house prices fell by 0.4% to £296,648, while annual growth eased to 2.5%.
Jonathan Hopper, CEO of Garrington Property Finders, commented:
“Halifax’s figures reveal a market that is listless rather than limping. Price growth and buyer demand are both strong in some areas, but overall the picture is mixed and Halifax’s data reflect this.
“In large part this is a legacy of the distorting effects of the Stamp Duty deadline, which sucked up huge numbers of would-be buyers who would ordinarily have been buying this summer.
“Thousands of sales were rushed through in the first three months of the year, and HMRC data show the number of completed sales shrank by 63.5% between March and April. While transactions have since picked up, the market is still settling.
“But May’s dip in average prices is also a nod to what a buyer’s market this has become. The number of homes for sale is high relative to the number of buyers, and in many areas estate agents have so many properties already on their books that they are encouraging sellers to reduce their asking price.
“In some cases agents are even refusing to list homes where they feel the owner is asking for an unrealistic price.
“For sellers with the ‘will’ to move this summer, recalibrating their asking price is the ‘way’ to get moving in today’s highly price-sensitive market.
“This is holding back average prices in London and the South West of England, where asking prices are being trimmed as second home owners sell up and some of those who moved to the region during the post-pandemic ‘race for space’ reassess their priorities.
“By contrast Northern Ireland, Wales and Scotland are all recording stronger price growth than England, as the balance between supply and demand there is more even, and buyers are more willing to stretch their budgets as they see prices as being very good value.
“With mortgage interest rates levelling off after several months of gradual falls, the market is settling rather than surging into summer.”
