HOUSE prices in the UK are falling for the first time since 2012, giving first-time buyers a glimmer of hope that they may be able to soon step onto the property ladder.
New data shows that in the three months to April, prices fell by 0.2 per cent, the first quarterly decline in four-and-a-half years.
Over the past month alone, prices have fallen by 0.1 per cent, data from Halifax shows, although there has been an annual increase in house prices of 3.8 per cent.
The bank said the average property price in the country is now £219,649.
While a 0.2 per cent decline might not seem much, on a £219,649 property, that’s £440 more in a buyer’s pocket.
Martin Ellis, Halifax housing economist, said that housing demand appears to have been “curbed” in recent months due to a deterioration in housing affordability driven by the period of rapid house price growth during 2014-16.
“Signs of a decline in the pace of job creation, and the beginnings of a squeeze on households’ finances as a result of increasing inflation, may also be constraining the demand for homes,” he said.
Ellis added: “A continued low mortgage rate environment, combined with an ongoing acute shortage of properties for sale, should nonetheless help continue to underpin house prices over the coming months.”
Halifax’s data conflicts with rival lender Nationwide’s, which last week showed that house prices were growing at 2.6 per cent annually – the lowest rate for four years.
But the difference in figures is because Nationwide tracks prices month-to-month, while Halifax looks at average values over three months – meaning it records bigger movements in overall market trends, rather than short-term fluctuations.
How to get help buying a house
THERE are several government schemes available to help you get on to the housing ladder.
- Help to Buy loan: This scheme is for those who have a 5 per cent deposit, and is only available on new-build properties that are worth less than £600,000. The government lends you up to 20 per cent of the property value (interest-free for the first five years) which gives you access to cheaper mortgages. You will need to pay this back at the end of the mortgage or when you sell.
- Starter Homes: First-time buyers under the age of 40 can access this new scheme. You’ll get a 20 per cent discount on the market value of the property (new-build only) but you cannot sell or let the property for five years after you buy it.
- Shared ownership: This scheme is available to non-homeowners who earn £80,000 a year or less (£90,000 in London). People can buy a share of a home from a housing association and continue to rent the remainder. Buyers will need a ten per cent deposit as well as money to cover stamp duty and other fees. You’ll also need to find a mortgage lender that is willing to lend on shared ownership properties.