UK house prices climbed by 7.8% in the year to January, the latest Zoopla House Price Index has revealed, taking the average house price to £244,100.

This was a slight deceleration in growth from the 8% that Zoopla reported in December.

The property expert still suggested that price growth had “gained momentum” during most of 2021, after one of the busiest years the market has ever experienced. However, with the lowest level of quarterly house price growth since August 2020, the index suggested the market is now showing signs that price growth is starting to ease.

Zoopla also warned that the imbalance between buyer demand and supply is not going to unwind in the near-term. In late February, buyer demand for homes was 70% above the five-year average, and the total stock of homes available for sale was 43% lower.

However, a recovery in the levels of new supply is also gathering momentum, the index also suggested. In January and February, new listings were up in every part of the country compared to 2021 as more movers, and landlords, listed their homes for sale.

“The sheer level of activity in the market in recent years has eroded the stock of homes for sale,” Zoopla’s head of research, Gráinne Gilmore, commented.

“But the data indicates that more homes are now coming to the market, as movers and other owners list their properties for sale – and this will create more choice for the many buyers active in the market.

“However the imbalance between high demand and lower stock will take much longer to unwind, and this imbalance will continue to underpin pricing in the coming year.”

Gilmore added: “The new supply of homes has risen above 2021 levels and is approaching the scale of new listings seen at this time of year before the pandemic hit in 2020, signalling that the market is starting to move back towards more normal conditions. However, total supply of stock remains tight, which will continue to put upwards pressure on pricing.”

Share Story: