House prices dropped by 3.1 per month-on-month in April, the latest index from Halifax reveals.
Average house prices fell to £220,962 last month, down from £227,871 in March, wiping nearly £7,000 off the value of a typical home.
But the annual trend was slightly more positive as house prices ticked up by 2.2 per cent over the three months to the end of April compared to the same period last year, when the average price was £220,401.
Halifax managing director Russell Galley says: “Both the quarterly and annual rates have fallen since reaching a recent peak last autumn, with these measures providing a more stable indication of the underlying trend than the monthly change.
“Housing demand has softened in the early months of 2018, with both mortgage approvals and completed home sales edging down. Housing supply – as measured by the stock of homes for sale and new instructions – is also still very low.
“However, the UK labour market is performing strongly with unemployment continuing to fall and wage growth finally picking up.
“These factors should help to ease pressure on household finances and as a result we expect annual price growth will remain in our forecast range of 0-3 per cent this year.”
North London estate agent and former Royal Institution of Chartered Surveyors chairman Jeremy Leaf says: “Although a little historic, these figures are disappointing as there is a market of sluggish growth and transactions, despite still showing modest price rises.
“And yet we are entering what is supposed to be the busy spring buying season, which tends to set the tone for the rest of the year.
“More recently, activity and listings have picked up but we are finding the market still quite sensitive and only those prepared to negotiate hard are moving on.
“Now that interest rates are unlikely to go up this month, hopefully there will be more interest, and particularly from first-time buyers, to take advantage of competitive mortgage deals and realistic prices.”
