house prices

Annual house price growth stable

British house prices rose more than expected in December with annual house price growth stable at 1.3 per cent.

Figures released today from Halifax reveal that prices in the three months to December were 1.3 per cent higher than in the same three months a year earlier – up from the 0.3 per cent annual growth rate recorded in November

Russell Galley, managing director, Halifax, said: “In December the average cost of a home was £229,729 and annual house price growth stood at 1.3 per cent. A stronger monthly growth figure for December improved from a weaker November.

“Overall, house price growth in 2018 was very much within the range of 0-3 per cent as we forecast at the start of the year.”

He said Halifax is expecting continued stability in 2019 with prices with between two per cent and four per cent price inflation.

“This is slightly stronger than 2018, but still fairly subdued by modern comparison. However, this expectation will clearly be dependent on the Brexit outcome, with risks to both sides of our forecast.”

He said that this year, mortgage payment affordability is more difficult to predict. “There are competing pressures with signs of positive annual pay growth supporting affordability, but risks associated with the potential for higher interest rates are pulling in the other direction. On balance we do not see affordability pushing house price growth significantly in either direction.

The shortage of homes for sale and continuing low levels of housebuilding both constrain the supply of houses, and in turn support high prices, which will continue to inhibit demand in 2019.”