UK house price growth slows but still hits record high

UK house prices hit a recorded high in January as the average UK house price rose to £276,759, according to data from Halifax.

However, the pace of growth slowed notably to 0.3% which was the lowest level of growth since June 2021.

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“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,” said Russell Galley, Managing Director, Halifax.

“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.”

Regional growth

Despite overall growth slowing to a marginal 0.3%, there were still areas of the Uk enjoying bumper increases in the year to January.

Wales recorded 13.9% house price growth and was again the UK’s fastest growing region. Northern Ireland also recorded a strong 10% increase in prices while Scotland prices rose 8.9%/

London recorded a 4.5% increase – the highest in over a year – and the North West remained the strongest area in England gaining 12%.

Lack of supply

The jump in house prices can once again be attributed to a lack of supply with new instructions dropping 14% according to the latest RICS Residential Market Survey.

The number of mortgages approved in December rose 5% to 71,100.

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