House prices static in May - Halifax

(Sharecast News) - House prices were largely unchanged last month, industry data showed on Friday, as the market continued to stabilise. According to the latest Halifax house price index, average house prices were "static" in May, down just 0.1% on a monthly basis. On an annual basis, house price growth was 1.5%, up from 1.1% in April.

As a result, a typical UK home now costs £288,688.

Amanda Bryden, head of mortgages at Halifax, said: "Market activity remained resilient throughout the spring months, supported by strong nominal wage growth and some evidence of an improvement in confidence about the economic outlook.

"A period of relatively stability in both house prices and interest rates should give a degree of confidence to both buyers and selling.

"While homebuyers will continue to respond to changes in borrowing costs, set against a backdrop of limited supply of properties, the market is unlikely to see huge fluctuations in the near term."

The housing market, already under pressure because of the cost of living crisis and a supply squeeze, was hit hard by the disastrous 2022 mini budget, which sent mortgage rates soaring.

But mortgage rates have moderated over recent months and with the Bank of England widely expected to start cutting the cost of borrowing, the market has started to recover.

Stephen Perkins, managing director at Yellow Brick Mortgages, said: "Static is a fair summary of the market right now. House prices are remaining firm, despite all the financial pressures coming from the high base rate.

"The cost of living crisis has eased off and wage growth as proved resilient. If feels like the market is holding its breath, awaiting either a base rate reduction or a new government."