Nationwide has reported that UK house prices have fallen by 0.4% in April as the rising cost of borrowing puts potential buyers under pressure. According to the largest building society in the UK, the average cost of a home now stands at £261,962, which is four percent below the summer 2022 peak. The figure is based on the lender’s mortgage lending, which doesn’t include major cash buyers or buy-to-let agreements. Cash buyers make up about a third of all housing sales.
The decline follows a string of rate increases in new fixed-rate mortgage plans by several banks in recent days, triggered by expectations of fewer and slower interest rate cuts by the Bank of England. Halifax recently announced a plan to increase the expense of much of its mortgage range by 0.2 percentage points on Thursday. There are currently around 1.6 million existing borrowers with relatively inexpensive fixed-rate contracts expiring this year.
The rising cost of borrowing was cited by Nationwide as the primary cause of the latest drop in house prices. On an annual basis, the pace of house price growth fell from 1.6% in March to 0.6% in April, according to the data from the building society. Each region has its own set of factors that influence home prices, so property values will have changed at varying rates in different parts of the country.
The building society’s survey showed that high house prices and the high cost of borrowing were discouraging potential first-time buyers from buying a house, causing roughly 50% of them to delay their purchase plans over the last year. According to the Halifax, demand for smaller homes such as flats has been increasing more quickly than for larger properties as affordability has become a concern
Read the full article from The BBC here: Read More