Average UK house price falls 0.3% in January

The average house price in the UK fell by 0.3% in January, the biggest monthly fall since April last year, according to the latest Halifax House Price Index.

The monthly drop pushed the average property value down to its lowest level since October, at just under £252,000.

However, the index showed that house prices remain around £13,000 higher than a year ago, having climbed 5.4% from their level in January 2020.

Halifax’s data also revealed that in the latest quarter, from November to January, house prices were 1.6% higher than in the preceding three months, between August and October.

Halifax managing director, Russell Galley, suggested the figures indicate that the recent upturn in the housing market could be “running out of steam”, with the annual rate of house price inflation slowing to its lowest level since August.

“Industry figures for agreed sales remain well above pre-pandemic levels but new instructions to sell have decreased noticeably, and total stock held by estate agents has risen to its highest level since before the EU referendum in 2016,” Galley said.

“The stamp duty holiday has undoubtedly helped to fuel growing demand amongst households for larger properties. However, given the current time to completion across the market, transactions in the early part of 2021 probably don’t include many borrowers who expect to benefit from the stamp duty reprieve.

“How far and how deep any slowdown proves to be is a challenge to predict given the prevailing uncertainty created by the pandemic. With swathes of the economy still shuttered, and joblessness continuing to edge higher, on the surface this points to slower market activity and downward price pressures in the near-term.”

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