At 4.5%, UK house price growth ended 2016 at the same level as 2015, despite Brexit, stamp duty changes and tenants fees ban.
Data recently published by lender Nationwide also revealed that month on month prices increased by 0.8%, increasing the average home price to £208,898.
Overall, the index report showed that the country’s housing market was in a largely stable condition in 2016. However, it also mentioned indications that London’s significant period of outperformance may be drawing to a close.
For the first time in 8 years, annual house price growth in the capital was lower than the UK average, at an increase of 3.7% over the year, compared to 12.2% in 2015.
Robert Gardner, Nationwide’s chief economist, explained that developments regarding house prices in 2017 will heavily rely on the wider economy, which is currently surrounded by a greater amount of uncertainty.
“Like most forecasters, including the Bank of England, we expect the UK economy to slow modestly next year, which is likely to result in less robust labour market conditions and modestly slower house price growth,” he said.
“But we continue to think a small gain, around 2%, is more likely than a decline over 2017 as a whole, since low interest rates are expected to help underpin demand while a shortage of homes on the market will continue to provide support for house prices,” he added.
On top of that, Nationwide also revealed in its quarterly data that all regions experienced house price growth in 2016. East Anglia topped the growth list last year with an increase of 10.1% over 12 months.
England as a whole saw an increase of 5.1% over the year, Scotland remained relatively steady with a growth of 2.2%, Northern Ireland slowed down with a growth rate of 0.7% and Wales saw an increase at 2.4% annual growth.
Director of investment at property crowdfunding platform Property Partner, Rob Weaver, believes that it’s a good thing that house prices are still creeping up despite Brexit, Property Wire reported.
“The combination of record low borrowing rates propping up demand and a severe shortage of both housing stock and available homes for sale has meant prices have continued to rise. Predictions for the year ahead are positive although we most probably won’t be seeing London house prices over the short term,” he pointed out.
“Overall, property prices are heading upwards slowly but surely despite uncertain times politically and economically. In the long term, the UK housing market will continue to outperform most other investment classes,” he added.