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House price growth slows again to 1.9% in January, Halifax says, taking average UK property price to £281,684
- Prices fell 3.6% over the past three months as activity slowed
- Month-over-month, prices remained flat after falling in December and November
According to the latest Halifax house price index, the growth rate of house prices slowed from 2.1 percent in December to 1.9 percent in January.
Price moves in January bring the average house price in the UK to £281,684, up £5,000 from December, but the value has fallen by 3.6 per cent over the past three months.
Month-on-month prices remained flat after two months of consecutive declines of 1.3 percent in December and 2.4 percent in November.
The average home in the UK now costs £281,684, according to Halifax
Kim Kinnaird, director of Halifax Mortgages, said: ‘We expected pressure on household incomes from rising costs of living and higher interest rates to lead to a slower housing market, especially when compared to the rapid growth of recent years. In the course of 2023, this trend is likely to continue as higher borrowing costs lead to reduced demand.
“For those looking to get up or down the housing ladder, confidence may improve in the short term. Lower home prices and the potential for interest rates to fall below levels expected last year should lead to improvements in the affordability of buying a home over time.”
Most regions in the UK experienced a slowdown in growth. Wales, which has enjoyed strong growth in recent years, saw its rate fall 4 percentage points from 6% to 2% last month.
In London, which remains one of the least affordable areas in the country, average house prices fell by £11,396 over the year.
Month-over-month, prices remained flat, but fell during the quarter
Jeremy Leaf, North London estate agent and former RICS residential chairman, said: ‘Since the turn of the year, buyers and sellers have slowly begun to come to terms with the changed environment. Buyers are negotiating hard, so especially the significant number who are largely equity driven or not even reliant on mortgage financing are not included in these numbers.
“Looking forward, we expect small price increases and decreases, but not a major correction, especially as more inventory begins to become available.”
More good news for borrowers: mortgage rates have continued to fall since the start of the year, despite the Bank of England’s base rate reaching 4%, a 14-year high.
And while interest rates are expected to rise further to a spring peak, analysts say rates will continue to fall after a sharp rise in October last year.