Arabic version: انخفاض أسعار المنازل في المملكة المتحدة بسبب تأثير حرب إيران على الطلب

Average UK house prices fell by 0.5% in March, according to Halifax, as mortgage rates driven higher by the repercussions of the Iran war dampened demand. The average property price is now £299,677 while annual growth has also slowed. This decline reverses a 0.3% rise in February before the beginning of the conflict which drove up energy costs, raising fears that inflation could climb and there would be no cuts to interest rates this year.

The situation has seen hundreds of the cheapest deals disappear in recent weeks. Halifax noted that the recent increase in mortgage rates had not been as sharp as four years ago. Amanda Bryden, head of mortgages at Halifax, said: “The recent slowdown in the housing market reflects the wide uncertainty regarding the conflict in the Middle East.” According to BBC News, concerns about higher energy prices have pushed up inflation expectations, which in turn led to a rise in mortgage rates.

Despite recent fluctuations in oil prices, with Brent crude prices falling by 15% to $94 per barrel following plans for a conditional ceasefire between Washington and Tehran, mortgage rates in the UK have not improved. The average rate on a two-year deal was 4.83% at the start of March, but is 5.90% now, according to Moneyfacts.

Experts suggest that the duration of weaker demand in the housing market will largely depend on how long-lasting these pressures prove to be and the wider implications for the economy and unemployment. Adam French, a spokesperson for Moneyfacts, indicated that while the mortgage market could stabilize if the ceasefire holds, it is more likely to slow or pause increases rather than trigger any sharp falls.