Despite annual house price growth slowing in all nations and regions in January, Halifax reports that prices are stable – even with the cost of living crisis.

UK house prices remained stable in January, according to Halifax. The lender has just published its latest House Price Index showing that house prices remained largely unchanged in the month of January. There was a quarterly price dip of 3.5% due to prices dipping by 1.3% in December and 2.4% in November. However, the housing market showed annual growth of 1.9%.

‘The start of 2023 has brought some stability to UK house prices, with the average house price remaining largely unchanged in January at £281,684, a very small decrease on December,’ says Kim Kinnaird, Director, Halifax Mortgages. ‘This followed a series of significant monthly falls at the end of last year.’

Kinnaird adds: ‘The pace of annual growth has continued to slow to 1.9% from 2.1% in December, which is the lowest level recorded over the last three years. The average house price is now around £12,500 below its peak in August last year, though it still remains some £5000 higher than in January 2022 (£276,483).’

Cost of living crisis

Halifax had anticipated that the cost of living crisis and higher interest rates would have caused the housing market to slow, especially when compared to rapid growth in the last three years.

‘For those looking to get on or up the housing ladder, confidence may improve beyond the near term,’ says Kinnaird. ‘Lower house prices and the potential for interest rates to peak below the level being anticipated last year should lead to an improvement in home buying affordability over time.’

Most regions of the UK have seen a slowing in annual house price growth. Wales saw some of the strongest house price growth in the last few years but saw its rate of annual growth fall from 6% in December to 2% in January. The average house price in Wales is now £210,275 compared to £224,210 in August.

Price growth has also slowed in the South West of England, with annual growth now standing at 2.7% compared to 6.% in December.

more news