Annual house price growth in the UK slowed to 1.1% in January from 2.8% in December, the lowest rate since June 2020, according to the latest figures from Nationwide Building Society.
Property values fell 0.6% in January from December, following a 0.3% drop in December, marking the fifth monthly decline in a row and the longest string of declines since the financial crisis in 2009. Annual price growth slowed to 1.1% from 2.8%.
The average home is now worth £258,297, down from £262,068 a month ago, and prices are 3.25% lower than their August peak.
In the survey, Robert Gardner, Nationwide’s chief economist, said there were some “encouraging signs that mortgage rates are normalising, but it is too early to tell whether activity in the housing market has started to recover.”
“The fall in house purchase approvals in December reported by the Bank of England largely reflects the sharp decline in mortgage applications following the mini-Budget,” he added.
“It will be hard for the market to regain much momentum in the near term as economic headwinds are set to remain strong, with real earnings likely to fall further and the labour market widely projected to weaken as the economy shrinks,” Gardner suggested.
Housebuilders broadly shrugged aside the latest downbeat industry news following falls yesterday after much weaker-than-expected mortgage lending numbers.