House prices stable in January
Average house prices rose by 0.2% in January, reaching £205,898 according to Nationwide.
The building society said this puts annual house price growth at a ‘broadly stable’ 4.3%, only modestly below the growth rate in December of 4.5%.
Robert Gardner, Nationwide’s chief economist, said: “The outlook for the housing market remains clouded, reflecting the uncertainty surrounding economic prospects more broadly.
“On the one hand, there are grounds for optimism. The economy has remained far stronger than expected in the wake of the Brexit vote. Recent data indicates that the economy didn’t slow in the second half of 2016 and the unemployment rate remained stable at an 11-year low in the three months to November.
“However, there are tentative signs that conditions may be about to soften. Employment growth has moderated, and while wage growth has edged up in recent months, in real terms (i.e. after adjusting for inflation), earnings growth has already slowed.
“With inflation set to rise further in the months ahead as a result of the weaker pound, real wages are likely to come under further pressure. Employment growth is also likely to continue to moderate, should the economy slow as most forecasters expect.”
Alex Gosling, CEO of online estate agents HouseSimple.com, added: “A ‘broadly stable’ January is no bad thing after the last six months of economic uncertainty we’ve faced.
“Many were expecting us to be starting the New Year sifting through the remains of a property market, but the market has actually stood up remarkably well in the face of some pretty strong economic headwinds.
“In fact, if you look at where average prices are today compared to June 2016, when the country voted to leave the EU, prices are actually higher.”