House prices fell by -0.4% in May, says the Halifax

While the housing market has shown stability, there are emerging concerns that could impact its upward trajectory. Rising swap rates are already leading to higher mortgage costs, potentially dampening buyer demand. Additionally, regional disparities in price growth highlight underlying imbalances that may affect market dynamics. As we move into the summer, all eyes will be on inflation, SWAP rates, and the Bank of England Monetary Policy Committee decision due on 19 June 2025.

We saw strong demand for both purchase and remortgage activity throughout May. However, the mortgage market feels like a seesaw with every positive rate whisper followed by a swap-rate wobble, and it’s paralysing some would-be movers into inaction. That indecision may come at a cost. House prices are still edging upward, and while the pace is steady, affordability pressures mean that waiting for a ‘perfect moment’ might just see buyers priced out altogether. Right now, it’s not a full-blown buyers' market. Well-presented homes in the right locations are still commanding strong interest and quick offers. Sellers who are realistic on price remain in the driving seat but only just. As we head into summer, we expect the market to stay active but tense. Mortgage rates are unlikely to drop dramatically, and buyers are increasingly focused on what they can afford today rather than waiting for tomorrow’s maybe. That mindset shift will keep the wheels turning , albeit cautiously.

Sluggish house price growth might offer a glimmer of hope for young people trying to get on the ladder, with homes becoming cheaper in real terms. But there’s a flip side—housing wealth underpins consumer confidence, and with the UK economy so reliant on spending, this stagnation is bad news for growth and for Rachel Reeves’ economic ambitions. Meanwhile, Northern Ireland continues to defy the trend—perhaps a sign that being closer to the EU still has its perks.

Halifax is reporting price falls whilst Nationwide reports price increases. This conflicting data is very confusing to the general public. The key is to understand that there will always be fluctuations in house prices but with one general direction overall, and that’s up. Until the housing shortage is fixed, property will always be in demand. So, if you are considering purchasing a property then the sooner you get on the ladder the better. Don’t wait for rates to fall because nothing is guaranteed. Pick a product that suits your circumstances get on the property ladder and be patient.

This version of house price data looks to better reflect the activity before and after the stamp duty changes, so is not a huge surprise to see some correction over those March figures. With buyers still very active, prices are being challenged to recoup these additional costs to move home, and with mortgage rates creeping up, it has all the hallmarks of a stalled market.

House prices may have dipped slightly but overall the market remains fluid. In the ongoing story that is the UK property market, the resilience of house prices has always been a key narrative. Demand for property is always there, whatever the economy throws at the housing market. Yes, affordability is proving a challenge for some but we're seeing lenders increasingly seek to address that. A lot is riding on where inflation heads next and all eyes are focused on the Monetary Policy Committee meeting later this month.

Whilst a dip in house prices may concern some, the UK property market has proved itself to be tougher than the Black Knight from Monty Python. As rates improve throughout the year, property prices will rise again.