House price growth fell to its weakest level in over a year in January, according to the latest index from Nationwide.
Prices increased by 0.2 per cent in the month to January, compared to a rise of 0.8 per cent in the month to December. Annual growth dropped from 4.5 per cent in December to 4.3 per cent, according to the lender, the weakest since November 2015.
“The outlook for the housing market remains clouded, reflecting the uncertainty surrounding economic prospects more broadly,” says Nationwide chief economist Robert Gardner.
“On the one hand, there are grounds for optimism. The economy has remained far stronger than expected in the wake of the Brexit vote.
“However, there are tentative signs that conditions may be about to soften. Employment growth has moderated, and while wage growth edged up in recent months, in real terms (i.e. after adjusting for inflation), earnings growth has already slowed.”
The average UK house price in January was £205,240, down from £205,898 in December.
Responding to the figures, Legal & General Housing Partnerships director Stephen Smith says: “The Government must establish a ground-breaking housing policy and it needs to happen now. The eagerly anticipated Housing White Paper is the perfect opportunity to shape the future of our housing market once and for all.
“What remains unchanged in our housing market is the ongoing disparity between supply and demand. Until we see some real action on the ground to realign these two fundamental facets of our housing market, first time buyers will continue to struggle when attempting to get that that first step onto the housing ladder.”