Following the tenth successive month without any improvement to UK house sales, stock levels remain close to a record low.
Halifax report that between November 2016 and January 2017, house prices rose 2.4% from the previous three months and 5.7% compared to the same three months a year before.
December House Price Index: Annual Price Growth Stable Going Into 2017
However, this rate was well below than December’s annual growth rate of 6.5%, and remains significantly lower than the 10% peak reached in March 2016.
Between December 2016 and January 2017, house prices also fell by 0.9%. This was the first monthly drop since August 2016, when prices fell by 0.3%, and came after four consecutive monthly increases.
Following the tenth consecutive month without improvement to the number of properties listed in the UK, stock levels remain close to a record low.
Speaking on the matter, Martin Ellis, Halifax housing economist, said:
“The quarterly and annual rates of house price growth remained robust even though they are lower than in spring 2016. UK house prices continue to be supported by an ongoing shortage of property for sale, low levels of housebuilding, and exceptionally low interest rates”.
Ellis didn’t hold much hope of serious improvements for 2017, continuing to state that, “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.”
However, increased demand in affordable housing means a growing proportion of the UK population are renting, which presents an opportunity for buy-to-let investors.
It is predicted that rent prices will actually continue to rise faster than house prices, but low availability and affordability make renting the preferred option for many.
