U.K. House Prices Fall For Third Month: Halifax Survey

(RTTNews) - House prices in the U.K. fell for a third month in a row in May amid the global uncertainty linked to the tensions in West Asia and subdued demand due to higher borrowing costs, results of a survey by S&P Global showed on Friday.

The house price index fell 0.1 percent month-on-month in May, same as in April, the S&P Global survey conducted for the Lloyds Bank subsidiary Halifax revealed. In March, the index declined 0.5 percent.

The average property price decreased to GBP 298,806 from GBP 299,251 in April.

The year-on-year increase in house prices accelerated to 0.5 percent in May from 0.4 percent in April.

Economists had forecast a monthly increase of 0.1 percent and an annual gain of 1 percent in house prices.

"Property price trends continue to reflect the uncertainty linked to developments in the Middle East," Amanda Bryden, head of mortgages, at Halifax said. "Despite recent cuts to mortgage rates, higher inflation expectations have kept borrowing costs above the level seen at the start of the year, continuing to stretch affordability for many buyers and temper demand."

Bryden also said the UK housing market remains resilient and transaction levels are still moving. Increased support from lenders such as more flexible affordability checks and a rising low-deposit options should ease the hurdles for first-time buyers, she added.

"Looking ahead, borrowing costs and consumer confidence are likely to continue shaping activity in the coming months, with house prices expected to remain broadly stable while interest rates stay elevated," Bryden said. "The housing market remains closely tied to wider global developments, with a return to sustained house price growth dependent on an improvement in the inflation outlook and a fall in mortgage costs."