Iran Conflict Sinks UK House Prices Amid Rising Mortgage Rates

UK house prices declined by 0.5% in March, according to Halifax's latest figures. The typical home now costs £299,677, marking a reversal from February's 0.3% uptick. The drop is attributed to the ongoing Iran conflict and its impact on global markets.

Mortgage rates have surged as a result of the conflict, with hundreds of competitive deals vanishing in recent weeks. Halifax noted that while the current rise in mortgage rates has been less severe than during the 2022 mini-Budget, concerns over energy costs have driven inflation expectations higher.

Amanda Bryden, head of mortgages at Halifax, stated: 'The recent slowdown in the housing market reflects the wide uncertainty regarding the conflict in the Middle East.' Nathan Emerson, chief executive of Propertymark, warned that inflation is anticipated to climb in the coming months and will directly affect household budgets and Bank of England decisions on base rates.