the uk housing market is sputtering again with economists predicting the downturn has further to run as rising interest rates bite into the budgets of consumers the warning came after reports thursday showed house prices resumed their decline last month and mortgage approvals unexpectedly fell in april households repaid mortgage debt at an historic pace the findings indicate more pain ahead for the britain which is suffering economic stagnation and the worst inflation among group of seven nations trouble in the housing market could also cost prime minister rishi sunak’s ruling conservative party which is trailing the labour opposition in polls a little more than a year before the deadline for the next election following are the key charts showing the outlook for uk house prices the bank of england has raised interest rates from 01 to 45 since late 2021 in an effort to tackle stubbornly high inflation yet households have yet to feel the full impact about 13 million households will do so this year when they are forced to refinance cheap fixedrate deals at substantially higher rates that could add around £200 250 a month to the interest payments of the average mortgagor according to the boe those rates could be even higher than thought just a few weeks ago after a shock inflation reading last month dashed hopes of a pause in the boe’s most aggressive ratetightening cycle in four decades instead traders are pricing in a hike to as high as 55 this year in response mortgage rates which had eased after surging to 14year highs in the market turmoil of last autumn are rising again rates on the most popular mortgages are now above the 5 level the boe has identified as a stress threshold for consumers “headwinds to the housing market look set to strengthen in the near term” robert gardner chief economist at nationwide building society said after the lender reported a 01 drop in property values in may prices are now 4 below their peak last year nationwide issued its report shortly before boe data showed lenders authorized 48690 home loans in april 6 fewer than in march households repaid £14 billion of mortgage debt in april the weakest month excluding the pandemic on record meanwhile mortgage lenders have started to pull cheap deals from the market in anticipation of higher borrowing costs in an echo of the budget crisis that wrecked liz truss’s shortlived premiership according to data provider moneyfacts lenders have withdrawn close to 800 residential and buytolet mortgage products in a matter of days the prospect of rising borrowing costs has even revived talk that britain could slip into recession a threat to sunak and the conservatives nor will a modest fall in house prices do much to help those unable to get onto the housing market after a decadeslong housing boom affordability is particularly stretched in london where prices paid by firsttime buyers are around nine times their average salary   imf upgrades uk growth but warns rates may need to rise more   uk’s record migration may have boosted home rental costs by 7   boe raises key rate to 45 signaling more hikes may follow