Analysis of movement in house price indices

Each month, Halifax, Nationwide and HM Land Registry publish house price indices, tracking the movement in average house prices in the UK. Halifax and Nationwide updates are based on mortgage approvals data, while the UK HPI is a joint production by HM Land Registry, Land and Property Services Northern Ireland, ONS and Registers of Scotland.

House price movement remains stable in latest index results

Annual movement in UK house prices was up in May 2024, according to both Halifax and Nationwide’s indices. 

Halifax reported a 1.5% annual increase in house prices, while Nationwide’s index showed a smaller increase of 1.3% on the same period. 

On a monthly basis, Halifax said prices were down by 0.1% on April 2024, while Nationwide’s index showed a 0.4% increase.  

Amanda Bryden, Head of Mortgages at Halifax, pointed to a ‘broadly stable picture’ for the last few months, with some evidence of an improvement in confidence about the economic outlook. 

She said: ‘A period of relative stability in both house prices and interest rates should give a degree of confidence to both buyers and sellers. While homebuyers and those remortgaging will continue to respond to changes in borrowing costs, set against a backdrop of a limited supply of available properties, the market is unlikely to see huge fluctuations in the near term.’ 

Nationwide’s Chief Economist, Robert Gardner, said that wage increases and lower inflation have boosted consumer confidence. 

He said: ‘The market appears to be showing signs of resilience in the face of ongoing affordability pressures following the rise in longer-term interest rates in recent months.’  

Nationwide also analysed movement in house prices around previous general elections and found they do not appear to alter trends significantly. It concluded that ‘broader economic trends appear to dominate any immediate election-related impacts’. 

The UK HPI, with the latest data for April 2024, showed a 1.1% increase in house prices compared with April 2023, and a 0.3% increase on March 2024. As the UK HPI figures cover house sales that may have been agreed months previously, there tends to be a lag in the data. 

^{Source: Halifax (Methodology), Nationwide (Methodology), UK HPI (Methodology)}

^{Source: Nationwide}

Karl Horton, Chief Data Officer at BCIS said: ‘The Bank of England’s decision to maintain the base rate at 5.25% for the seventh consecutive time at its June meeting means borrowing rates remain high for both consumers and developers.  

‘Affordability is crucial to both supply and demand and the latest construction output data shows it’s an uneven road to recovery. Private housing new work was down by 4.4% in April compared with March, and down by 12.4% on an annual basis. We’re forecasting it to decrease overall by 11% in 2024 before returning to growth in 2025.’ 

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