Halifax House Price Index February 2023

UK house prices increased 2.1% YoY in February according to mortgage lender Halifax.
All UK nations and regions saw the rate of annual growth slow in February
Average UK property now costs £285,476 (down from £282,360 in January).

House prices stabilise

Source: Halifax, IHS Markit

Key Trends

The annual rate of house price growth was 2.1% for the third consecutive month in February.
House prices increased 1.1% on a monthly basis, following a marginal monthly increase in January (0.2%) on the back of significant falls at the end of 2022.
Annual growth reduced the most in the North East at 1.1% in February following a 3.6% rise in January. Annual growth fell the least in Scotland at 2.2% in February compared to 2.3% in January.
London saw average house prices fall 0.9% to £526,842 from January’s £530,416, but house prices in the region remain over £240,000 more than the UK national average.
Average prices of flats have fallen 0.3% YoY, while prices for terraced houses have broadly stagnated (+0.3% YoY).
Detached houses saw prices increase 1.5% YoY in February, although this is the lowest rise since the end of 2019.

Outlook

February saw UK house prices stabilise further, helped by recent reductions in mortgage rates, climbing consumer confidence and a resilient labour market.
The cost of a home nonetheless remains down on a quarterly basis, suggesting a continued downward trend.
In cash terms, average house prices are down around £8,500 (2.9%) on the August 2022 peak but are still almost £9000 above values seen at the beginning of 2022, as well as being above pre-pandemic levels.
Most sellers will therefore benefit from price gains made during the pandemic, but high prices will continue to discourage buyers in the near-term.
In the long-term, falling property values could boost buyer confidence, but this depends closely on the trajectory of interest rates, cost-of-living pressures and the continued resilience of the labour market.