UK house prices rose by 0.4% in July, marking the strongest monthly increase in six months, according to new data from mortgage lender Halifax. The rise, which outpaced economist forecasts of 0.3%, is the latest sign of a stabilizing UK housing market following months of volatility.
Compared to the same period last year, UK house prices were 2.4% higher in July, though that figure represents a slowdown from the 2.7% annual increase recorded in June. Analysts had predicted more modest gains following the expiration of a stamp duty tax break in April, which previously spurred a rush of property purchases.
Affordability Improving Amid Easing Mortgage Rates
Halifax’s Head of Mortgages, Amanda Bryden, noted that while challenges remain for first-time buyers and those moving up the property ladder, the overall picture is improving. “With mortgage rates gradually easing and wage growth continuing, housing affordability is slowly getting better,” she said.
Bryden added that house prices are likely to “follow a steady path of modest gains through the rest of the year.”
Bank of England Rate Cut Expected
The latest figures come as the Bank of England is expected to cut its base interest rate from 4.25% to 4%. However, uncertainty looms over whether further rate reductions will follow due to ongoing inflation concerns and signs of a cooling labor market.
The central bank’s decision could influence mortgage rates further, potentially providing more support to homebuyers and helping sustain recent gains in the property market.
Nationwide Also Reports Monthly Price Rise
Rival lender Nationwide reported similar findings last week, showing that its house price index rose 0.6% in July, reinforcing broader evidence that the UK housing market is stabilizing after a turbulent first half of the year.
