UK house prices fell for a second consecutive month in April, as Halifax halved its estimate for the annual rate of growth owing to the conflict in the Middle East.<\/p>\n
Halifax, which is part of Lloyds \u2013 Britain\u2019s biggest mortgage lender \u2013 said that the cost of a typical UK home fell by 0.1% in April, to \u00a3299,313. This followed a 0.5% fall in March.<\/p>\n
Halifax said the annual rate of house price growth had slowed to 0.4% from 0.8%.<\/p>\n
Amanda Bryden, head of mortgages at Halifax, said: \u201cAfter a strong start to the year, recent global developments have added a greater degree of uncertainty to the outlook.<\/p>\n
\u201cIn particular, higher energy prices have fed into inflation expectations, prompting markets to reassess the path for interest rates \u2013 a shift that has already pushed up borrowing costs for many buyers.<\/p>\n
\u201cThis understandably leads to more caution among some households, with the cost of living once again front of mind and extra thought being given to planned property moves.\u201d<\/p>\n
On Thursday, the average two-year fixed mortgage rate stood at 5.77%, up from 4.83% at the start of March, according to Moneyfacts. The average five-year fixed rate mortgage was 5.69%, up from 4.95%.<\/p>\n
Before the conflict in the Middle East, the UK housing market had shown solid growth this year, with the price of an average home rising 0.8% month-on-month in January and 0.3% in February.<\/p>\n
The strong start to the year had led Halifax to forecast 1.2% house price growth on an annual basis in February.<\/p>\n
\u201cThe problem facing the market at the moment is that many sellers are still pricing based on expectation rather than current market reality and that\u2019s creating a growing disconnect between buyers and sellers,\u201d said Chris Hodgkinson, managing director of House Buyer Bureau.<\/p>\n
\u201cWhilst demand is still there, buyers are far more price sensitive in the current climate and homes that aren\u2019t positioned correctly from day one are simply sitting on the market for longer, forcing sellers into larger reductions further down the line.\u201d<\/p>\n
The economic turbulence caused by the Middle East conflict has created huge uncertainty in the housing market.<\/p>\n