UK house price growth has fallen for the first time since July

Emma Haslett
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House price growth was muted in November (Source: Getty)

Homeowners who had hoped UK house price growth was beginning to pick up again were disappointed today, after figures showed growth slowed in November for the first time since the summer.

Prices increased 3.9 per cent year-on-year last month, down from 4.5 per cent in October, according to Halifax. The dip came after four consecutive months of rising growth.

Average house prices rose to £226,821, up 0.5 per cent from £225,664 in October. On a quarterly basis, growth rose to 2.4 per cent, from 2.3 per cent in October.

Although there have been suggestions house price growth in the UK will continue to stay muted, Halifax pointed to figures from HM Revenues & Customs, which showed monthly UK home sales rose to their highest level ever this year, while the value of the UK's housing stock hit £6 trillion.

However, it also pointed out that mortgage approvals have been weakening since August, while figures from the Royal Institution of Chartered Surveyors have suggested the number of people putting homes up for sale fell in October.

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“The imbalance between supply and demand continues to support house prices, which doesn’t look like changing in the near future," said Russell Galley, managing director at Halifax Community bank.

"Further ahead, increasing affordability issues, as price increases continue to outstrip wage growth, are likely to curb housing demand and cause price growth to ease."

Jonathan Hopper, managing director of Garrington Property Finders, agreed.

“It’s tempting to dismiss what price growth there is as a mere side effect of the chronically low levels of supply, but that does a disservice to the brisk levels of demand in several regions.

“But demand is being channelled by one over-riding consideration – affordability. With wages falling in real terms and buyers wary of overpaying while the market is in flux, even the most determined buyers are willing to walk away if the price isn’t right.

“With the flight of capital from London and the most expensive regions still in full flow, we’re once again seeing a market of extremes. At lower price points buyers are struggling to find a property, while the most expensive homes are struggling to find a buyer.

“Few expect the Chancellor’s Stamp Duty cut to provide a silver bullet for the misfiring market, and all eyes are now on the Prime Minister to cut a Brexit deal – which might just give the market the shot of clarity and confidence it needs to start 2018 on the front foot.”

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