House prices back on the rise as average property now costs £2,000 more than last April | Personal Finance | Finance

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The average UK house price rose by 0.1 percent in April on a monthly basis, after a fall of 0.9 percent in March, according to Halifax.

Property prices grew by 1.1 percent annually, meaning they have gone up by around £2,000 compared to a year ago.

A typical UK home cost £288,949 in April, compared with £288,781 in March, the bank said.

Amanda Bryden, head of Mortgages at Halifax, said that house prices have “largely plateaued” in 2024.

She said: “This reflects a housing market finding its feet in an era of higher interest rates. While borrowing costs remain more expensive than a few years ago, homebuyers are gaining confidence from a period of relative stability.

“Activity and demand is improving, evidenced by greater numbers of mortgage applications so far this year, while at an industry level mortgage approvals have reached their highest point in 18 months.

“Our recent research also found that buyers are adjusting their expectations, with first-time buyers in particular compensating for higher borrowing costs by targeting smaller properties.

“We see this reflected in property prices for the first few months of this year, with the value of flats rising most sharply, closing the ‘growth gap’ on bigger properties that’s existed for most of the last four years.”

She said the bank is expecting house prices to “rise modestly” over the rest of the year as the base interest rate and mortgage rates fall.

Alice Haine, personal finance analyst at Bestinvest by Evelyn Partners, said: “While a return of house price growth is positive, the market remains volatile as challenges persist for buyers and those looking to refinance.

Interest rates have been on pause at a 16-year high of 5.25 percent since August last year, a factor causing considerable uncertainty in the mortgage market.

“While mortgage rates eased dramatically at the start of the year as hopes of imminent rate cuts soared, they have undergone a reprice in recent weeks amid market revisions over the magnitude and timing of rate cuts.”

“A rate cut at this week’s Monetary Policy Committee meeting appears unlikely, with rate setters likely to stick to the ‘higher for longer’ mantra for now as they wait for concrete evidence that inflationary pressures really have eased.”

Mortgage borrowers may be feeling the pinch after many household bills went up from April, including water bills, council tax, mobile and broadband.

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