UK house prices rise at slowest pace since June, says Halifax

Bloomberg

UK house prices rise at the slowest pace in more than six months in January after a bumper end to 2021 left the average value of a home at a record high.
Prices rise just 0.3% following four months of gains above 1%, mortgage lender Halifax said on Monday. In a sign of a more normal market, the number of transactions fall towards pre-Covid levels, it said.
House prices enjoyed a stellar run in the aftermath of the UK’s first Covid-19 lockdown, fuelled by a tax cut and a demand for more space, but analysts expect far more modest gains in 2022.
The market may also be hampered by a cost of living squeeze in the UK and a series of interest rate rises from the Bank of England that investors expect to take the benchmark to 1.5% by August — the highest since before the financial crisis.
“Household budgets face even greater pressure from an increase in the cost of living, and rises in interest rates begin to feed through to mortgage rates,” said Russell Galley, managing director at Halifax. “While the limited supply of new housing stock to the market will continue to provide some support to house prices, it remains likely that the rate of house price growth will slow considerably over the next year.”
The annual pace of increase remained at 9.7% through January, Halifax said, while prices in London rise 4.5%, the most in over a year. The average price of a UK home is now a record 276,759 pounds ($375,000).