House prices hold steady in June - Halifax

5th Jul 2024 07:02

(Sharecast News) - House prices remained largely unchanged in June, industry data showed on Friday, reflecting a subdued market.

According to the latest house price index from Halifax, average house prices edged down just 0.2% on a monthly basis in June. On an annual basis, growth was unchanged on May, at 1.6%.

As a result, a typical UK house now costs £288,931.

Amanda Bryden, head of mortgages at Halifax, 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."

Ashley Webb, UK economist at Capital Economics, said: "While we expect house prices to flatline to best in the coming months, our view that interest rates will be cut from 5.25% to 3% in 2025 suggests prices will rise by around 5% next year, following a more tepid increase of around 0.5% this year.

"If we're right to think that mortgage rates will fall below 4% next year, we suspect the new Labour government will preside over an improving housing market in 2025."

Peter Arnold, UK chief economist at EY, said: "The bigger picture is one where the housing market is standing still, with prices and mortgage demand broadly flat in recent months.

"On the plus side, the EY Item Club thinks the housing market has passed the bottom, with the risk of a significant correction in prices now much lower than it was a year ago.

"At the same time, mortgage affordability remains very stretched relative to historical norms.

"The EY Item Club thinks the most likely scenario is that we see a period of relative stability in activity and prices until this valuation gap recedes."