UK house prices fall for first time this year amid rising mortgage rates
UK house prices have fallen for the first time this year due to rising interest rates linked to the ongoing conflict in Iran. The average house price dropped by 0.6% in May, although it remains 1.7% higher than the same time last year. Experts predict that the housing market will continue to slow down as higher borrowing costs affect affordability.
- ▪House prices in the UK fell by 0.6% in May compared to April.
- ▪The average house price is currently £278,024, which is 1.7% higher than last year.
- ▪Mortgage rates have increased, with the average two-year fixed rate at 5.68%.
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Houses in Lewes. Mortgage interest rates have broadly risen across the market in recent months. Photograph: Graham Prentice/AlamyView image in fullscreenHouses in Lewes. Mortgage interest rates have broadly risen across the market in recent months. Photograph: Graham Prentice/AlamyHouse pricesUK house prices fall for first time this year amid rising interest ratesNationwide finds typical price was £278,024 in May, as Savills says Iran war has ‘fundamentally changed’ outlook Business live – latest updates Lauren AlmeidaMon 1 Jun 2026 03.00 EDTLast modified on Mon 1 Jun 2026 03.01 EDTSharePrefer the Guardian on GoogleHouse prices fell in the UK for the first time this year in May, as rising interest rates triggered by the war in Iran hurt homebuyer demand.The price of the average UK home…
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