Annual house price growth slowed to 6.4%, from 7.3% in December, according to Nationwide’s monthly house price index
UK house price growth slowed for the first month in six in January, as the market cooled down ahead of the end of the stamp duty holiday, which runs out in March.
According to Nationwide’s monthly house price index released on Tuesday morning, annual house price growth slowed to 6.4%, from 7.3% in December.
It said prices were down 0.3% month-on-month, after taking account of seasonal factors, and home ownership has risen for third year running.
Robert Gardner, Nationwide’s chief economist noted that you would expect housing market activity to weaken months ahead of the stamp duty discount because it can take several months to buy a house, and therefore many looking to buy now will miss out.
The typical relationship between the housing market and broader economic trends has broken down over the past nine months, Gardner said. This is because many people’s housing needs have changed as a direct result of the pandemic, with many opting to move to less densely populated locations or property types, despite the sharp economic slowdown and the uncertain outlook.
Indeed, the total number of mortgages approved for house purchases in 2020 actually exceeded the number approved in 2019, and house price growth ended 2020 at a six-year, he said.
Alongside a slight dip in house prices, the latest English Housing Survey published by the Ministry of Housing, Communities & Local Government (MHCLG) indicated a slight increase in the home ownership rate in 2020, to 64.6% (from 63.8% in 2019).
This is the third year in a row that the home-ownership rate has increased, though it remains well below its 2003 peak of 70.9%.
Both the number of people owning their home with a mortgage and those owning outright increased compared with a year ago. More than half (54%) of the 15.4 million households in England own their home outright, with the majority (5.2 million or 63%) aged 65 or over.
