UK house price growth picks up on strong labour market

January saw a small uptick in house price growth, continuing signs of a renewed dynamism in the sector after a year of only marginal increases.

Annual house price growth increased 1.9 per cent in January, according to the Nationwide House Price Index, rising from 1.4 per cent in December. The price rise month-on-month, after considering seasonal fluctuations, was 0.5 per cent.

“The underlying pace of housing market activity has remained broadly stable,” Robert Gardner, Nationwide’s chief economist, said, adding that the number of approved mortgages for purchasing homes fell within the “fairly narrow” range of the past 2 years.

“Healthy labour market conditions and low borrowing costs appear to be offsetting the drag from the uncertain economic outlook,” he said.

The small pick-up follows 12 successive months in which annual house price growth remained stuck at below 1 per cent.

Political uncertainty around a departure from the EU dissuaded buyers at the end of the weakest decade for house price growth since the 1990s. Prices rose 33 per cent across the decade compared to 180 per cent in the 1980s.

The average house price was £215,897 in January, compared to £215,282 the previous month.


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