Halifax reported a steadying of house price inflation as last month’s prices dropped to their lowest since May. The latest Halifax house price index found annual growth slowed to 2.5 per cent in September from 3.7 per cent in August, as quarterly change – July to September – remained at 1.8 per cent for the second month.
On a monthly basis, house prices fell by 1.4 per cent in September to sit at an average of £225,995 – the second consecutive monthly fall and down from July’s year high of £229,776.
Russell Galley, managing director at Halifax, said the measures suggested house price inflation was steadying.
He said: “This is set amongst mortgage approvals and completed house sales remaining broadly unchanged, although a gradual pickup in wage growth has helped to support household finances.
“The annual rate of growth is near the top of our forecast range of 0-3 per cent for 2018, as a low supply of new homes and existing properties for sale, combined with historically low mortgage rates and a high employment rate, continue to support house prices.”
Kevin Roberts, director at Legal & General Mortgage Club, said limited housing supply was still hindering the ambitions of borrowers in the UK.
He said: “Whether it is first-time buyers, second steppers or people looking to downsize, a lack of suitable housing is still preventing many from making their first or next purchase.
“There is good news – steadier house price growth, schemes like Help to Buy and a wider choice of mortgages are making it easier for some first-time buyers to take a step onto the ladder. However, more support from the government is needed.”
Steve Seal, director of sales and marketing at Bluestone Mortgages, said despite the steadying in price growth there were still “significant” barriers when it comes to securing funding.
He said: “Whilst the average growth of house prices remains steady, this does not necessarily mean all doors are open for aspiring homeowners.
“Lifestyle and financial habits are changing – and it is unfair that some potential buyers are turned away for not fitting an outdated computer scoring system.
“A missed phone or credit bill, or unforeseen costs for an accident shouldn’t mean you are barred from home ownership.”
Mr Seal said these customers instead need a personalised underwriting experience that ensures the nature of their situation is fully understood.
He said: “It is vital that specialist lenders continue to find the best solutions for all of their clients, based on a rounded and fair view of their individual financial situation.”
Source: FT Adviser