The annual rate of house price growth came to 1.6% in June, the same as figures in May, a report has stated.
According to Halifax’s House Price Index, the monthly change came to -0.2%, which compares to no monthly change in May.
The report found that the average house price is priced at £288.455, which is slightly down from £288,931 in May.
Northern Ireland recorded the strongest property price growth of any national or region, with annual house price growth coming to 4%, an increase from 3.3% in May. The average price of a property is £192,457.
In England, the sharpest rise in house prices was in the North West at 3.8%, and the average price is £231,351.
House prices in Scotland rose by 1.6%, with the average house costing £204,663, while in Wales house prices rose year-on-year by 2.7%, with the average house coming to £220,197.
East England was the only region or nation to register a decline of 0.9% year-on-year, with the average house price pegged at £220,197.
London is still the most expensive region, ticking up 0.9% year-on-year, with the average property coming to £536,306.
Third consecutive month that house prices have stayed flat
Amanda Bryden, head of mortgages at Halifax, said that this was the third successive month in which house prices have “stayed relatively flat”.
She said: “This continued stability in house prices – rising by just +0.4% so far this year – reflects a market that remains subdued, though overall activity has been recovering. For now, it’s the shortage of available properties, rather than demand from buyers, that continues to underpin higher prices.
“Mortgage affordability is still the biggest challenge facing both homebuyers and those coming to the end of fixed-term deals. This issue is likely to be eased gradually, through a combination of lower interest rates, rising incomes, and more restrained growth in house prices.
“While, in the short term, the housing market is delicately balanced and sensitive to the pace of change to base rate, based on our current expectations, property prices are likely to rise modestly through the rest of this year and into 2025.”
‘Time will tell’ impact of Labour government on housing market
Karen Noye, mortgage expert at Quilter, said that on the “dawn of a new Labour government”, house prices have stayed “largely flat”.
She continued: “Time will tell whether a new Labour government will help spur buyers back to the market. In its manifesto, Labour made the ambitious pledge to build 1.5 million homes, which could go some way to addressing the UK’s housing crisis.
“Such an increase in housing supply could improve the prospect of homeownership for young people, but in order to do so, it will be imperative that the party follows through on its pledge.”
Noye noted that “ambitious housing targets” have “historically been challenging to meet, and this is likely to be no different”.
“Building 1.5 million homes within five years is an extremely tall order [that] will require significant resources, substantial investment and careful planning. Its success will also depend on the engagement and cooperation of local authorities, developers and the communities in which these new homes will reside.
“Though a significant challenge, if achieved, building 1.5 million new homes could make housing more accessible and affordable. Labour’s ‘freedom to buy’ scheme, on the other hand, may not have quite the same impact,” she added.
Noye said that the Freedom to Buy scheme, which would make the mortgage guarantee scheme permanent, was an interesting move as the “scheme has achieved very little take-up since launch as it does not tackle the fundamental issue of high property prices relative to average incomes”.
“What’s more, with house prices still at risk of fluctuating, negative equity could become a significant issue for those taking such high-loan-to-value mortgages. Halifax reported the average UK home now costs £288,455, meaning a 95% mortgage supported by the guarantee scheme would require a £14,422.75 deposit. Having such a relatively low deposit amount would leave very little wiggle room in terms of house price changes before falling into negative equity.
“Prospective first-time buyers and homeowners across the country have been crying out for help for some time now. Labour must follow through on its commitment to increase housing supply in the first instance, and it should explore alternative options to ensure that more people are supported in getting onto the housing ladder without needing to make potentially risky decisions when it comes to high-loan-to-value mortgages,” she explained.
Affordability still an ‘issue’ despite flat house prices
Mark Harris, chief executive of mortgage broker SPF Private Clients, said that affordability “continues to be an issue for borrowers” with “flat house prices” implying that buyers are “not getting carried away and agreeing to any price”.
He continued: “With the big five lenders – Barclays, HSBC, Santander, Halifax and Natwest – reducing their mortgage rates this week, lenders continue to jostle for business as they ramp up the summer sales. Those lenders who haven’t yet repriced are likely to follow suit, as long as service levels allow, which is welcome news for hard-pressed borrowers.
“Even though swap rates, which underpin the pricing of fixed-rate mortgages, are not showing a consistent downwards trend, the need to generate more business seems to be motivating lenders to tweak their rates.”
Harris said that the “slowdown in activity and muted transaction levels” was not due to the general election, but a “lack of action from the Bank of England when it comes to cutting rates”.
“With the election now out of the way and inflation at its 2% target, the stage is set for the first rate reduction in August,” he added.
Anna is currently the deputy editor for Mortgage Solutions and editor for Specialist Lending Solutions. She has worked as a journalist since 2019, having secured her Gold Standard NCTJ diploma from News Associates in a fast-track six-month course.
She started her career as a report at specialist publication The Insurance Insider covering a wide range of areas before joining Mortgage Solutions and Specialist Lending Solutions in 2021.
In her role, she helps put together and structure the news agenda for the day and writes up press releases, reports, interviews, analyses and exclusives across both titles. She also commissions blogs for Specialist Lending Solutions and hosts online masterclasses and in-person events across the business.
She has been shortlisted for three journalism awards, which include BIBA Journalist and Media Awards Scoop of Year Award in 2020, Headline Money Mortgage Journalist of the Year Award (B2B) in 2022 and 2023.
Prior to being a journalist, Anna worked in ecommerce across Snow + Rock, Cycle Surgery and Runners Need websites, and before that worked at specialist financial PR firm Rostrum.
In her spare time, Anna enjoys reading, seeing live music, and cooking for friends and family. When she gets a chance, she also enjoys hiking, skiing and indoor rock climbing.
