House price growth slows at end of 2017

UK house prices ended 2017 with a slight slowdown in growth, the latest figures have shown.

Halifax said the year-on-year increase in prices during the final quarter of the year was 2.7 per cent. However, the annual rise recorded in December was lower than that seen in November (3.9 per cent).

Quarterly comparisons showed that house prices between October and December were 1.3 per cent up on the July-September period. That figure is down from 2.3 per cent in October and November.

Furthermore, prices in December 2017 fell by 0.6 per cent from the previous month, the first decrease since June last year.

The latest Halifax report also showed that monthly home sales in the UK have been above 100,000 for 11 consecutive months. In November 2017 the figure reached 104,200, the highest since March 2016.

However, mortgage approvals for house purchase have remained fairly flat, increasing by only 0.4 per cent month-on-month in November.

Russell Galley, managing director at Halifax Community Bank, said the housing market in 2017 largely lived up to expectations, in terms of slow price growth and relatively flat construction activity, completed sales and mortgage approvals.

Looking ahead to the coming year, Mr Galley said: “Nationally, house prices in 2018 are likely to be supported by the ongoing shortage of properties for sale, low levels of housebuilding, high employment and a continuation of low interest rates making mortgage servicing affordable in relative terms.

“Overall we expect annual price growth to continue in the range of 0-3 per cent at the end of 2018.”

The latest monthly report from Nationwide, released on December 20th 2017, forecast a marginal increase of one per cent in house prices in 2018 owing to factors such as subdued economic activity and the “ongoing squeeze” on household budgets.