House Price Growth Slowed in January

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Property prices are continuing to hit a record high however last month, the monthly rate of increase stood at 0.3% which is the lowest rise since June 2021.

As for the annual rate of growth, this remains steady at 9.7% which is equivalent to the average price of a home being £276,759 (a new record high).

The House Price Index released by Halifax has shown that Wales is leading the property market as they have been named as the strongest performing nation/region in the UK. Annual house price inflation is currently at 13.9%, which is a slight decrease since December and average prices are now £205,253.

Northern Ireland also is showing strong property price growth, with prices up by 10.2% since last year which equates to the average price of a property being £170,982.

Scotland are just behind the UK in relation to their annual rate of inflation which has in fact slowed to 8.9% resulting in the average property cost being £192,698.

More specifically, in England, the North West again is the strongest performing area. Year-on-year, the annual inflation is 12.0% with house prices being £213,200 on average which makes the North West the second highest rate of annual growth in the UK.

London is the weakest performing region in the UK because their annual house price inflation has accelerated for a third consecutive month and now stands at 4.5%. This was double the rate recorded in December and its strongest performance seen in over a year.

Russel Gallery, Managing Director for Halifax, said: “House price growth slowed somewhat at the start of the year, rising by just 0.3% in January, the smallest monthly increase since June 2021. This followed four consecutive months of gains above 1%, and with annual growth remaining at 9.7%, the average UK house price was little changed, edging up slightly to a new record high of £276,759. Overall prices remain around £24,500 up on this time last year, and £37,500 higher than two years ago.

“Following the peak activity of 2021, transaction volumes are returning to more normal levels. Affordability remains at historically low levels as house price rises continue to outstrip earnings growth. Despite record levels of first-time buyers stepping onto the ladder last year, younger generations still face significant barriers to home ownership as deposit requirements remain challenging.

“This situation is expected to become more acute in the short-term as household budgets face even greater pressure from an increase in the cost of living, and rises in interest rates begin to feed through to mortgage rates. While the limited supply of new housing stock to the market will continue to provide some support to house prices, it remains likely that the rate of house price growth will slow considerably over the next year.”

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