MortgagesApr 12 2018

House prices stagnate at the start of 2018

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House prices stagnate at the start of 2018

House prices stagnated at the beginning of the year, according to the Halifax house price index.

On a quarterly basis, house prices were unchanged over the first three months of 2018 - though on a yearly basis they were up by 2.8 per cent.

The average UK house price was £223,819 in the first quarter of 2018 - an increase of just £300, according to the index.

Paul Smith, economics director at IHS Markit, said annual house price inflation was among the weakest he had seen in the past five years.

He said: "The subdued performance of the UK housing market, especially in the south of England, seems to reflect a general lack of appetite amongst households at present for activity related to major purchases in line with the general squeeze on real incomes seen in recent months.

"Allied with a general undercurrent of Brexit-related uncertainty, plus the likelihood of higher (albeit still historically low) interest rates later in the year, the market seems set to persist in a subdued state for the foreseeable future."

While the majority of regions saw annual house price inflation, London was the most notable exception, with 3.8 per cent reduction in prices.

That followed on from a 0.7 per cent decline in the fourth quarter of 2017 and represented the worst outturn for the capital in seven years.

In contrast, the East Midlands saw growth of 7.3 per cent and East Anglia registered 7.2 per cent, which were the strongest rates of annual price inflation, followed closely by Scotland, with 6.7 per cent and Yorkshire and Humberside, with 6.1 per cent.

The South East registered only a slight annual increase in prices of 0.3 per cent while the South West recorded inflation of just 1.9 per cent.

damian.fantato@ft.com