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Investing.com -- Recent reports from Halifax and Nationwide indicate that house prices in the United Kingdom (TADAWUL:4280) held steady in May.
Halifax on Friday reported a minor drop of 0.4%, or about £1,133, in house prices, following a 0.3% rise in April. On the other hand, Nationwide on Monday reported a 0.5% increase in house prices.
These contrasting figures suggest that the market is broadly stable, with the average U.K. house price now standing at £296,648, down from £297,781 in April.
The annual U.K. house price inflation is at 2.5%, a slight decrease from 3.2% in April. So far in 2025, house prices have dropped by an average of £531.
RBC analysts suggest that stable house prices are beneficial for both homebuyers and current homeowners. The stability helps prevent prices from becoming unaffordable while maintaining the wealth of those already on the housing ladder.
This environment may encourage more potential buyers to enter the market, particularly with the prospect of falling mortgage rates.
Gleeson, a builder focused on affordable homes, noted earlier this week that it has struggled to increase house prices. Despite this, Gleeson highlighted stubbornly high incentive levels, which RBC found surprising given the affordability of its homes.
Rising wages and declining mortgage rates are expected to improve affordability for lower-income households.
RBC believes that stable house prices are generally favorable for housebuilders, as they are typically price takers in the market.
With the current market conditions, housebuilders should also experience stable pricing.