Annual price growth continues to trend downward in the UK, official figures show
Average house prices in the UK increased by 4.9% in the year to January 2018, down from 5% in December 2017, according to the latest official figures to be published. It means that annual growth rate has now slowed since the middle of 2016 but it has remained broadly around 5% since 2017, the fig
Published -
Mar 21, 2018 5:09 AM
Average house prices in the UK increased by 4.9% in the year to January 2018, down from 5% in December 2017, according to the latest official figures to be published. It means that annual growth rate has now slowed since the middle of 2016 but it has remained broadly around 5% since 2017, the figures from the Office for National Statistics (ONS) show. The average prices of a house is now £226,000, some £11,000 higher than in January 2017 and unchanged from last month. In England house prices increased by 4.6% year on year to £242,000 while Wales saw house prices increase by 4.5% to £153,000 and in Northern Ireland prices were up 4.3% to £130,000. But Scotland leads the annual growth with a rise of 7.3% to £149,000. On a regional basis, London continued to be the region with the highest average house price at £486,000, followed by the South East and the East of England at £323,000 and £290,000 respectively. The lowest average price continued to be in the North East at £123,000. The East Midlands showed the highest annual growth, with prices increasing by 7.3% in the year to January 2018, followed by the South West up 6.9% and the West Midlands and East of England both 5.3%. The lowest annual growth was in the North East, where prices increased by 0.7% over the year, followed by London at 2.1%. According to Danny Belton, head of lender relationships at the Legal & General Mortgage Club, the figures show that the housing market is steady but he warned that affordability remains a challenge. ‘Despite commitments from the Government to address the housing supply crisis, for many the challenge of affordability remains, particularly in areas of high demand such as our towns and cities,’ he said. Market conditions are more favourable for first time buyers, according to Richard Sexton, director of e.surv chartered surveyors, but he too warned about affordability. ‘Lack of supply continues to push prices up year on year and saving for a deposit is one of the biggest challenges would-be home owners face,’ he said. ‘Although we have seen a genuine commitment from the Government, more housing initiatives need to be put in place if we are to see a real improvement in our supply,’ he added. There could be further good news for first time buyers if the slowing rate of annual price growth continues. Richard Snook, senior economist at PwC, pointed out that sales volumes in the UK to November 2017 fell 11% compared to the year before, suggesting that prices could weaken in coming months. ‘We are expecting UK wide house price inflation of around 4% in 2018,’ he said. He also pointed out that on a regional basis the picture is varied. ‘Prices in the North East of England dropped sharply from £130,000 to £123,000 on average between December and January. Whilst London posted a gain from £481,000 to £486,000 having been flat since the summer,’ he explained. ‘This move does not change the general picture of soft performance in parts of London and the South East. For example, prices in Oxford are 5% lower than a year ago and prices in the City of London are down 8%,’ he added.
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