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House prices rise 5.7% over last year

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Written by: Owain Thomas
07/02/2017
House prices rose 5.7% in the three months to January compared to the same period last year, according to the Halifax House Price Index.

The rate of increase has hovered around the 6% mark for a sixth consecutive month, suggesting the market may have returned to stability following the heat of late 2015 and early 2016.

However, expectations are that this figure may decline throughout the year as wider economic issues take effect.

On a quarterly basis, prices rose by 2.4%, compared to a 2.5% in the three months to December, but fell by 0.9% in January compared to the final month of 2016.

As a result, the bank estimates the average price of a home in the UK now stands at £220,260.

Halifax housing economist Martin Ellis noted that the annual rate of growth had eased to 5.7% from 6.5%, in December and was well below last March’s peak of 10.0%.

“The quarterly and annual rates of house price growth remain robust even though they are lower than in spring 2016,” he said.

“UK house prices continue to be supported by an ongoing shortage of property for sale, low levels of housebuilding, and exceptionally low interest rates. These factors are unlikely to change materially during 2017.

“Nonetheless, weaker economic growth and increasing pressure on spending power, along with affordability constraints, are expected to dampen housing demand, resulting in some downward pressure on annual house price growth during the year,” he added.

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