Property costs have been flat in June after falling by 0.3% in Might, Halifax’s home value index has revealed.
The long-term development has nonetheless been a value uplift nevertheless, as the typical value stands at £296,665, following a 2.5% improve year-on-year.
Sarah Coles, head of non-public finance, Hargreaves Lansdown, mentioned: “A serious downside is that properties have grow to be so costly that it’s pushing affordability to the restrict.
“And whereas mortgage charges have fallen, they’re not dropping significantly quick and stay a lot larger than we have now been used to in the last few years.
“It’s one purpose why property gross sales are stronger in components of the nation the place costs are typically decrease.
“Lenders have reacted to larger home costs by providing extra flexibility over how a lot individuals can borrow.
“Nonetheless, should you’re contemplating stretching your funds to purchase a brand new dwelling, at a time when costs are so sluggish, it’s very important to not push your self to the brink and find yourself being compelled to promote at a time when costs might not have risen sufficient to cowl your prices.”
Whereas home value development is sluggish, mortgage approvals and property transactions picked up, fuelled by rising wages and step by step falling rates of interest.
Amanda Bryden, head of mortgages, Halifax, mentioned: “In fact, challenges stay. Affordability remains to be stretched, significantly for these coming to the tip of fixed-rate offers.
“The financial backdrop additionally stays unsure; whereas inflation has eased, it’s nonetheless above goal, and there are indicators the roles market could also be softening.
“However with markets pricing in two extra fee cuts from the Financial institution of England by 12 months finish, and the typical fee on newly drawn mortgages now at its lowest since 2023, we proceed to count on modest home value development within the second half of the 12 months.”
Property costs in Northern Eire are up 9.6% in a 12 months, Scotland 4.9% and the North West of England, by 4.4%.
Nicholas Finn, managing director of Garrington Property Finders, mentioned: “In lots of areas the variety of properties coming onto the market far exceeds the variety of potential consumers.
“That is protecting value rises to a minimal, and even pushing costs down. In some areas the glut of provide is so acute that property brokers are refusing to listing properties the place they really feel the proprietor is asking for an unrealistic value.
“The imbalance is biggest in southern England, however is now not simply restricted to the capital and its commuter belt.
“Halifax’s knowledge exhibits that the slowest fee of value development is now within the South West – a mirrored image of the big numbers of second properties and vacation let properties being offered by their disenchanted homeowners.
“The web impact has been to show the south right into a purchaser’s market – wherein consumers can ask for, and with the fitting vendor, get a major discount in asking value.”
