House prices fell for the first time in six months in March amid rising mortgage rates, according to a lender.
Property values declined by 1pc last month when compared to February, the Halifax house price index showed.
The survey found that the average house price in Britain dropped to £288,430, around £2,900 less than last month.
Compared to the same month last year, house prices have risen by 0.3pc.
Halifax Mortgages director Kim Kinnaird said: “Financial markets have also become less optimistic about the degree and timing of Base Rate cuts, as core inflation proves stickier than generally expected.
This has stalled the decline in mortgage rates that had helped to drive market activity around the turn of the year.”
Purplebricks chief executive Sam Mitchell added: “The blip in house prices was caused by a small increase in rates at the start of March, since then we have seen banks compete more aggressively, rates reduce further, inflation come down ahead of expectations, and both viewings and offers levels are ahead of expectations.”
A separate survey by rival lender Nationwide also showed a decline in monthly house prices by 0.2pc between February and March.
Ms Kinnaird added:
That a monthly fall should occur following five consecutive months of growth is not entirely unexpected particularly in view of the reset the market has been going through since interest rates
began to rise sharply in 2022.Despite this house prices have shown surprising resilience in the face of significantly higher borrowing costs.
Affordability constraints continue to be a challenge for prospective buyers, while existing homeowners on cheaper fixed-term deals are yet to feel the full effect of higher interest rates.
This means the housing market is still to fully adjust, with sellers likely to be pricing their properties accordingly.
