Halifax’s house price index for April has found that, on a monthly basis, house prices in April were 0.6% lower than in March.
However, house prices in April were 2.7% higher than in the same month a year earlier.
In the latest quarter (February to April) house prices were 0.7% higher than in the preceding three months (November to January)
Russell Galley, managing director, Halifax, said:“The impact of measures taken to curtail the spread of coronavirus started to filter through to the housing market in April, with average prices falling by 0.6% compared to March, and the annual growth rate easing to 2.7%.
“With market activity currently almost at a complete standstill, the limited number of transactions available means that calculating average house prices has inevitably become more challenging. This will lead to a great deal of volatility until more data becomes available.
“It will not be until after lockdown restrictions are eased that we will get a sense of the new temporary normal conditions for the housing market. Social distancing raises new challenges for home viewings and valuations and this will require the industry to adapt to build and maintain consumer confidence. More immediately, we are likely to see some considerable movement in activity levels as buyers and sellers seek to kick-start previously agreed transactions which are likely to have stalled or been delayed.
“The future remains uncertain and based on our current forecasting we expect short-term headwinds to house prices, although we maintain our underlying confidence in the health of the housing market in the longer term.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, added: “The impact of the pandemic on the housing market is starting to filter through to these figures but we should not set too much store by them. With so few transactions being recorded, it is bound to have a significant impact on the calculation of an average house price, which could be argued is of limited relevance anyway.
“From the point of view of lenders, they remain open for business. They have committed significant resource to organising mortgage payment holidays but are increasingly turning their attention to new business, reducing already low rates and edging up loan-to-values. For those who wish to remortgage in particular, there are plenty of attractive deals to tempt them.”