House prices ‘stabilising’ after falls over past two months

The Halifax HPI says prices were static in January as the market settles down after successive drops prompted by the mortgage crisis.

Halifax house price

House prices stabilised in January after price falls in the previous two months, the latest Halifax HPI reveals.

The monthly change last month was 0% compared to drops of 1.3% in December and 2.4% in November.

Quarterly figures show a 3.6% price reduction as the market cools following a bumper few months.

Latest figures also say that the annual increase was 1.9%, down from 2.1% last month, and the lowest in three years.

Income squeeze
Kim Kinnaird, Director, Halifax Mortgages

Kim Kinnaird, director of Halifax Mortgages, says: “The start of 2023 has brought some stability to UK house prices, with the average house price remaining largely unchanged in January at £281,684, a very small decrease on December.

“We expected that the squeeze on household incomes from the rising cost of living and higher interest rates would lead to a slower housing market, particularly compared to the rapid growth of recent years.

For those looking to get on or up the housing ladder, confidence may improve”

“As we move through 2023, that trend is likely to continue as higher borrowing costs lead to reduced demand.

“For those looking to get on or up the housing ladder, confidence may improve beyond the near-term. Lower house prices and the potential for interest rates to peak below the level being anticipated last year should lead to an improvement in home buying affordability over time.”

Industry reaction


Link to Stamp Duty feature
Anthony Codling, CEO, Twindig

Anthony Codling, CEO at Twindig, says: “Whilst some seem to be taking delight in falling house prices and looking forward to a house price crash, the housing market is not following that particular script.

“Spring in our view will be a waiting game rather than a buoyant selling season with those that need to move moving, and those that want to move biding their time. We expect to see a more normal market in the autumn.”


Jeremy Leaf, north London estate agent and former RICS residential chairman, says:

Jeremy Leaf

“It was inevitable that the shock of the mini-Budget at the end of September, which prompted a steep rise in mortgage rates and the inexorable increase in the cost of living, would have an impact on the housing market.

“However, since the turn of the year, buyers and sellers have been slowly coming to terms with the changed environment. Buyers are negotiating hard, especially the considerable number who are largely equity-driven or not even dependant on mortgage finance so won’t show up in these figures.

“Looking forward, we are anticipating small ups and downs in prices but no major correction, particularly now more stock is beginning to become available.”

Tomer Aboody
Tomer Aboody, MT Finance

Tomer Aboody, director of property lender MT Finance, says: “There are signs of a little more confidence within the financial and housing markets, which has brought some stability to the latter with property prices relatively unchanged.

“A possible mantra for the year ahead is for buyers to stay sensible and beware of overstretching themselves. Homes will be there to be bought, but at a level which should suit the individual buyer’s affordability.”


image of Jason Tebb OTM
Jason Tebb, CEO, OnTheMarket

Jason Tebb, CEO at OnTheMarket, says: “Seasonal factors are increasingly evident compared to the previous two years in when the pandemic skewed the market cycle.

“Our own data shows that sellers expect it to take slightly longer to sell their homes than has been the case in recent months, which ties in with this, although confidence remains remarkably stable.

“Conditions remain challenging with the cost of living and mortgage rates higher than many have become used to.”

Mark Harris image
Mark Harris, CEO, SPF Private Clients

Mark Harris, CEO at mortgage broker SPF Private Clients, says: “Annual house price growth continues to slow, as activity softens and the market gradually returns to something closer to what we were used to pre-pandemic.

“There is encouraging news on the mortgage front with fixed-rate pricing continuing to edge downwards, and it’s only a matter of time before it will be possible to fix for five years at less than 4 per cent.”


James Briggs, Together
James Briggs, Together

James Briggs, head of personal finance intermediary sales at specialist lender Together, says: “Last week’s 0.5% rate hike may cause further jitters among borrowers and potential first-time buyers concerned about possible repayment pressures.

“However, due to previous lender price considerations the impact to actual prices should be minimal.

“Latest figures indicate rather than listing properties, more homeowners are reinvesting into current homes and renovating so they can continue living in properties for the foreseeable.”

What's your opinion?

Back to top button