Halifax: House prices were static in June, but first-time buyers return

House prices stagnated in June, following a drop of 0.3% in May, latest property data from Halifax shows.

The average cost of a home in the UK is now £296,665 - only £117 more than the £296,782 it cost in the previous month, and 0.3% lower than it was in the previous quarter.

Despite this, Amanda Bryden, head of mortgages at Halifax, said the resilience of the UK housing market “continues to stand out” even after it suffered a slowdown following the hike in stamp duty that took place on 1 April.

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Mortgage approvals and property transactions have picked up since April, with almost 4% more mortgages being approved in May and 25% more transactions being carried out in May than in April, according to the Bank of England and HMRC respectively.

The housing market has enjoyed a boost thanks to rising wages easing affordability pressures as well as more stable interest rates giving people more confidence to plan ahead. This includes a return of first time buyers, who have returned to pre-stamp duty change levels.

New regulatory guidance to take a more flexible approach to affordability assessments has also helped boost the housing market.

“Affordability is still stretched, particularly for those coming to the end of fixed-rate mortgage deals. The economic backdrop also remains uncertain; while inflation has eased, it’s still above target, and there are signs the jobs market may be softening.”

Will house prices rise in 2025?

With the Bank of England expected to cut rates again this year and mortgage rates to their lowest level since 2023, house prices could rise in the second half of 2025.

“We’ve already seen a heightened degree of activity over the first six months of the year and, as we head into H2, our expectation is that market activity will continue to strengthen,” Guy Gittins, CEO of Foxtons, said.

However, some experts are not quite as bullish. Ashley Webb, economist at Capital Economics, said June’s stagnation “suggests that the housing market remains slow to recover from both the rise in stamp duty on 1 April and the weak economy.

“While there are some encouraging signs that a recovery is underway, it probably won’t happen soon enough to meet our current forecast of a 3.5% rise in the year to Q4 2025.”

Where are house prices rising the fastest?

Though house prices stagnated across the country, some areas continue to outperform others by large margins.

As has been the case for quite some time now, house prices in Northern Ireland once again recorded the fastest annualised price growth in the UK, with the average home costing 9.6% more now (£212,189) than it did a year ago.

Prices are also growing quickly in Scotland, with annual growth hitting 4.9% while the average home in the region costs £214,891.

Faster-than-average growth has also been reported in Wales, where average property prices have grown by 4.4% in the last year, rising to £241,938.

In England, significant regional divisions exist in property price growth.

The north west has continued its recent winning streak, staying as the region in England where property prices are growing fastest, up 4.4% over the past year to an average of £241,938.

Meanwhile, the south west and London continue to see much more subdued growth, as the last year has seen average house prices rise by just 0.5% and 0.6% respectively.

London continues to be by far the most expensive part of the UK to buy a property, with the average house in the capital now costing £540,048.