Monthly house prices fell 1.6 per cent in March, according to the Halifax.
This, managing director Russell Galley says, “party corrects the significant growth seen last month and again demonstrates the risk in focusing too heavily on short-term, volatile measures.”
“Industry-wide figures show that the number of mortgages being approved remains around 40 per cent below pre-financial crisis levels, and we know that lower levels of activity can lead to bigger price movements,” says Galley.
Today’s figure is a noteworthy difference from the figure posted in February, in which Halifax claimed a monthly rise of 6 per cent.
Annually, prices grew 3.2 per cent, leaving the average UK house price at £233,181.
Halifax adds that the quarterly change on the average house price was a 1.6 per cent increase. The quarterly figure reported in February was a rise of 1.8 per cent.
Housesimple chief executive Sam Mitchell comments: “The danger of reading too much into monthly price changes at the moment is perfectly illustrated by what we have seen in the first three months of 2019.
“After average house prices fell 3 per cent in January, and then spiked 6 per cent in February, they have dropped off again by almost 2 per cent in March.
“Uncertainty around Brexit and low stock levels are major contributory factors, as is the impact of a market slowdown in London.
“If you take London out of the equation, we are seeing more normal market conditions in other parts of the country, particularly in the north, with healthy levels of transactions during this early spring period, when traditionally there is more activity in the market.”
Yopa chief property analyst Mike Scott agrees with Mitchell, highlighting the mixed view from the Halifax house price index.
He says: The annual rate of growth has increased compared with March 2018. However, this may be because prices in March last year were depressed by the “beast from the east” weather pattern.
“The change for the month shows a fall from February’s prices, which is a correction from last month’s “blip” of a 6 per cent increase from January to February.
MT Finance director of property Tomer Aboody adds: “March has been dominated by Brexit so the monthly fall in property prices comes as no surprise.
“The Brexit saga is such a debacle and until it gets sorted, one way or another, few people are going to do anything.
“There are fewer enquiries out there and fewer people want to sell. Less stock means values will go down – those selling, are those who have to sell and may therefore take a lower price.”
One77 Mortgages managing director Alastair McKee believes that the “erratic monthly price movement” trend is set to continue.
He says: “Much like our current position with the EU, the UK market is not quite sure whether it is coming or going at the moment and this has been reflected in short-term price measures.
“Although the number of mortgage approvals remains below pre-financial crisis levels, this is not necessarily a bad thing.
“While we continue to see a consistent level of demand for mortgage products and the cost of borrowing remains low, the current market has been built on a more stringent lending foundation and as a result, we will continue to see buyer demand fuel positive house price growth in the long-term.”