Annual house price growth slows for second successive month

The annual growth in house prices slowed in December, according to official figures published today.

The latest land registry data published by the Office for National Statistics shows prices grew by 9.8% in the 12 months to December.

This is down on the 10.6% growth seen in the year to November and the 12% figure for the year to October. It is however still historically high (see graph below).

Prices fell slightly from £296,000 in November to £294,000 in December.

The figures come off the back of the Halifax index last week showing that annual growth in January dropped to 1.9%, the lowest figure seen in three years. 

Despite the slowdown in annual growth, many agents are saying demand is still strong.

Jean Jameson, chief sales officer at Foxtons, said the agent has seen “strong appetite” in the new year with a 20% increase in valuations and an 8% increase in viewings in January.

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Tom Bill, head of UK residential research at Knight Frank, said: “Buyers and sellers faced some pretty extreme turbulence at the end of last year due to a spike in borrowing costs caused by the mini-Budget.

“Mortgage rates are still high compared to where they were a year ago but, crucially, have stabilised and are inching down. Annual price falls are almost inevitable in the coming months but demand and supply have recovered strongly since Christmas, which means a double-digit price crash this year feels unlikely.”

The Royal Institution of Chartered Surveyors (RICS) however said in its latest residential market survey last week that demand “remains muted” with its members reporting negative buyer demand for the ninth successive month.