April 2020 House Price Index published by Halifax

The April 2020 House Price Index published by Halifax shows house prices fell after the coronavirus restrictions were introduced.

Headlines:

• House prices in April were 2.7% higher than in the same month a year earlier
• On a monthly basis, house prices in April were 0.6% lower than in March
• 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.” .

Key facts – Housing activity:

• HMRC Monthly property transactions data shows a fall in UK home sales in March. UK seasonally adjusted residential transactions in March 2020 were 99,440 – down by 0.2% from February. Year-onyear, transactions in March were approximately 0.3% higher than March 2019 (-2.7% lower on a nonseasonally adjusted basis). (Source: HMRC, seasonally-adjusted figures)
• Mortgage approvals have fallen in March. Bank of England figures show that the number of mortgages approved to finance house purchases were 56,161 in March 2020 – this represents a 24% month on month fall from February, following four consecutive rises. Year on year fall is 10%. (Source: Bank of England, seasonally-adjusted figures)
• The latest set of results (March 2020) for the RICS Residential Market Survey have shown sentiment across the UK housing market predictably deteriorating as the Government measures required estate agents to close their offices. After a run of three successive monthly increases, buyer demand has a net balance of -74% (+17% in Feb). Sales volumes are down to -69% (+19% in Feb) and new instructions 72% (+11% Feb). (Source: Royal Institution of Chartered Surveyors’ (RICS) monthly report)

Kindly shared by Halifax