House prices in the UK were 2.2 per cent higher in the three months to January than in the same period a year earlier, the latest Halifax index has found.
However, the increase is lower than that recorded in the three months to December 2017, when house prices rose by 2.7 per cent.
Mortgage approvals for house purchases ended 2017 with a sharp fall, according to Halifax statistics, dropping by 5.7 per cent from November 2017 to 61,039, the lowest level since January 2015.
Over the year to December 2017 total mortgage approvals were 2 per cent lower than in the same period in 2016.
The average price of £223,285 at the beginning of the year is 1.9 per cent higher than in January 2017 but down from November 2017 when an average of £226,408 was recorded.
In positive news for the market, the number of first-time buyers has gone up by 6 per cent in the last 12 months, continuing an upward trend of six years. First-time buyers now account for half of all house purchases with a mortgage, an increase from 36 per cent a decade ago.
Halifax Community Bank managing director Russell Galley says: “Although employment levels grew by 102,000 in the three months to November, household finances are still under pressure as consumer prices continue to grow faster than wages.
“Additionally, it’s still too early to see any impact for first-time buyers from the abolition of stamp duty on purchases of up to £300,000, which was announced in the November Budget. “Despite the recent rise in the Bank of England Base Rate, mortgage rates are still very low. This, combined with an ongoing acute shortage of properties for sale, will continue to underpin house prices over the coming months.”