London: British house prices fell month-over-month for the second time in three months in September, and mortgage lender Halifax said on Friday that rising borrowing costs are likely to soon put “more significant downward pressure” on prices.
Halifax said that from August to September, house prices fell by 0.1%. The annual change in house prices was 9.9%, which was the slowest since January.
The director of Halifax Mortgages, Kim Kinnaird, said that the recent cut in a tax for homebuyers, which was part of Finance Minister Kwasi Kwarteng’s “mini-budget,” and the long-term lack of homes for sale would help to support the market.
But Kinnaird said that more interest rate hikes, high inflation, and the effect of higher mortgage borrowing costs on affordability “are likely to put more downward pressure on house prices in the coming months.”
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Last month, Kwarteng announced tax cuts that couldn’t be paid for. This has made the financial markets think that the Bank of England will raise interest rates, and some economists think that house prices will fall soon.
Halifax said that London’s house prices have gone up by 8.1% in the last year, which is the slowest rate of growth in the country.
Last week, a rival lender called Nationwide said that it was the first time since July 2021 that British house prices didn’t go up on a monthly basis.
