UK House prices are on course to fall below £300,000 in December
The UK's house prices are on course to fall below £300,000 in December – and house price growth is likely to weaken next year, new figures have shown.
The Rightmove House Price Index showed prices are on course to fall 2.1 per cent in December, after a 1.1 per cent fall in November.
That will put the average UK asking price at £299,159 – down from £305,670 in November.
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But the figure will still be 3.4 per cent higher than a year ago, down from a 4.5 per cent uplift in November.
Rightmove said the dip is largely thanks to the "usual seasonal fall", and said it was in line with the average over the last six years.
However, it added buyer activity was unusually strong, with sales agreed up 5.2 per cent on November last year.
But it said uncertainty over Brexit will combine with inflation to dampen house price growth next year. It forecast growth of just two per cent nationally, and five per cent in inner London (where figures published yesterday showed average prices increased just 0.1 per cent in November).
"The sword of Brexit uncertainty hangs over the market, an unknown factor that may – or may not – have damaging consequences for the economy and confidence," said Miles Shipside, Rightmove's housing market analyst.
"There was a bout of jitters with the unexpected referendum result, albeit now seemingly short-lived, but more may arrive after Article 50 is invoked. For the time being any nervousness is being over-ridden by high demand for the short supply of suitable homes for sale in the lower and middle market in many parts of the country."
He added that first-time buyers will push up demand thanks to cheap mortgages.
"Demand from first-time buyers looking to buy rather than rent will continue, fuelled by monthly mortgage repayments being cheaper than rent, and rents forecast to rise further," he said.
Last week figures by estate agent Haart showed the number of buy-to-let sales had fallen almost 64 per cent in the year to November, after a series of government measures aimed at making it harder to become a landlord.
Patrick Smith, the estate agent's chief executive, warned the policy may push up rents.
"The government’s attack on investors adds up to a ‘War on Landlords’ and a buy to let market crippled by tax hikes and unnecessary regulation. The effect has been to more than halve the number of buy to let sales in England and Wales, and the inevitable consequence will be fewer properties available to renters next year and higher rents."
