House price growth continues to slow: Halifax

House price inflation for the UK hit 8.8 per cent over the past 12 months, but a slowdown seems to be on the cards, data from the Halifax has found.

The lender’s latest monthly house price index found that prices were down 0.4 per cent month-on-month from September to October 2014, with just a marginal quarterly rise of 0.8 per cent from the second quarter of 2014 to the end of the third quarter this year.

According to the data, the rise was the slowest quarterly increase since December 2012, when house prices grew by 0.7 per cent.

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Martin Ellis, housing economist at Halifax, said: “Activity continues to decline, with mortgage approvals in September falling for the third successive month to a 14-month low, while home sales are at their lowest level since October 2013. The associated weakening in demand has brought supply and demand into better balance.”

Stephen Smith, director at Legal & General Mortgage Club, said: “Although this may feel like the housing market is slowing down, it is important to remember that the past year has seen a yearly increase of 8.8 per cent. This level of growth is not sustainable.

“House prices need to grow at a similar rate to wage inflation for the market to be stable and healthy in the long term.”

Adviser view:

Brian Murphy, head of lending for national advisory firm the Mortgage Advice Bureau, said: “Although the market appears to be easing, lenders must remain dedicated to their participation in government schemes such as Help to Buy and higher loan-to-value lending.”