Halifax House Price Index January 2023

UK house prices increased 1.9% YoY in January according to mortgage lender Halifax.
All UK nations and regions saw the rate of annual growth slow in January
Average UK property now costs £281,684 (down from £281,713 in December).

House prices slow

Source: Halifax, IHS Markit

Key trends

The annual rate of house price growth eased to 1.9% in January, from 2.1% in December, the lowest level recorded over the last three years.
The monthly fall in house prices was marginal, taking the average property price to £281,272, a very small decrease on December. This follows a series of significant monthly falls at the end of 2022 (-1.3% in December and -2.4% in November).
Wales saw its rate of annual growth ease to 2.0%, from 6.0% in December, having previously recorded some of the strongest annual house price inflation, while the South West also saw house price growth slow considerably (2.7% vs 6.0% in December).
Northern Ireland (6.9% vs 7.1% in December) and Scotland (2.4% vs 3.3% in December) saw annual price growth ease more slowly.
London recorded flat (0.0%) annual house price inflation compared to December (2.9%), although the price of a typical London home is still around £250,000 above the UK national average.

Outlook

January saw UK house prices stabilise, with the average price decreasing marginally from December. The average house price is now c.£12,500 (-4.2%) below its peak in August 2022, but remains £5,000 higher than in January 2022.
Rising living costs and higher interest rates have slowed the housing market, a trend likely to continue in the near-term as borrowing costs increase.
However, lower house prices and the prospect of interest rates peaking below the level anticipated last year may boost buyer confidence in the long term.