House prices rise again as mortgage rates ease

House prices rose again last month and there are signs that activity in the market is picking up, according to the UK's biggest mortgage lender.

The Halifax said prices rose by 0.5% in November, the second increase in a row.

It said recent figures for mortgage approvals suggested "a slight uptick" in activity among buyers as the cost of home loans eases.

However, prices are still lower than a year ago, and Halifax said the market would remain under pressure in 2024.

Property prices are 1% lower than in November last year, the lender said, with the average property costing £283,615.

Kim Kinnaird, director at Halifax Mortgages, said prices had "held up better than expected" over the past year.

However, she added that house prices continued to be "underpinned by a shortage of properties available, rather than any significant strengthening of buyer demand".

Despite this, increasing numbers of mortgage approvals suggest that the recent falls in mortgage interest rates "may be leading to increased buyer confidence, seeing people more inclined to push ahead with their home purchases".

However, she warned that uncertainty over the outlook for the economy meant it was difficult to know how long this pick up would last for.

"Other pressures - like inflation, the broader cost of living, overall employment rates and affordability - mean we expect to see downward pressure on house prices into next year," she said.

While Halifax is the UK's biggest mortgage lender, its figures only take into account buyers with mortgages and do not include those who purchase homes with cash or buy-to-let deals.

According to the latest available official data, cash buyers currently account for over a third of housing sales.