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Halifax: UK house prices tumbled 3.1 per cent in April as property market continues to slow

House prices fell over three per cent in April, following a 1.6 per cent rise in March, according to the latest research from UK bank Halifax.

In the last three months to April, house prices were up 2.2 per cent compared to the same three months last year, but were still down from the 2.7 per cent annual growth recorded in March.

House prices between February and April were also 0.1 per cent lower than in the last three months of 2017, the third consecutive drop in monthly prices, the data showed.

Russell Galley, managing director at Halifax said:

“Both the quarterly and annual rates have fallen since reaching a recent peak last autumn, with these measures providing a more stable indication of the underlying trend than the monthly change.”

Galley also said that housing demand had decreased in the first few months of 2018, with both mortgage approvals and completed home sales edging down. Housing supply also remains very low, Galley said.

Jeremy Leaf, north London estate agent and former residential chairman at the Royal Institution of Chartered Surveyors (RICS) called the figures “disappointing.”

“There is a market of sluggish growth and transactions, despite still showing modest price rises,” said Leaf. “And yet we are entering what is supposed to be the busy spring buying season, which tends to set the tone for the rest of the year.”

Howard Archer, chief economic adviser at EY ITEM Club was less optimistic, however, pointing out that the Halifax figures show “the sharpest monthly decline since September 2010 and was a much sharper-drop-than-expected”.

According to Archer, even allowing for poor March weather to have impacted house prices, “the underlying performance over the first quarter points to the housing market remaining muted as it pressurized by still limited consumer purchasing power, fragile confidence and likely further gradual Bank of England interest rate rises”.

The Bank of England is scheduled to reveal its latest monetary policy decision on Thursday, however, following poor economic indicators this month including sluggish GDP growth, an interest rate hike has begun to seem highly unlikely with investor bets only indicating a seven per cent chance of a rate rise.

Source: City A.M.