Halifax House Price Index: High Demand + Low Supply = Rising Prices
Professor Joe Nellis is economic adviser at MHA, the accountancy and advisory firm, and was one of the creators of the Halifax House Price Index.
House prices fell again in April, with the Halifax House Price index increasing by 0.3% in April, following a 0.5% fall in March — it is likely that this was just a blip.
Although the yearly rate of house price growth has slowed in recent months, April 2025 saw a 3.2% increase from the previous April and prices are continuing to rise year on year.
This comes as mortgage affordability is creeping up due to greater competition in the mortgage market providing more favourable rates, and consistently high earnings growth putting more money in potential homeowners’ pockets. These factors combine to increase demand for houses and drive prices up.
Despite strong demand for home ownership, the UK continues to be plagued by an inadequate supply of housing. The Government has committed to one of the most ambitious housebuilding programmes in recent memory — 1.5 million homes over the next five years — which would go some way to reversing climbing prices, but it remains to be seen whether this target can be met.