UK average house prices increased by 8.4% over the year to January 2015, down from an increase of 9.8% in the year to December 2014. This follows the house price increases the UK has experienced since April 2012 and is driven in large part by increases in London (13.0%). The average UK mix-adjusted house price in January 2015 was £273,000.
The lowest growth in January 2015 was in Yorkshire and the Humber, where prices increased by 3.6% over the year. Excluding London and the South East, UK house prices increased by 6.5% over the year to January 2015.
On a seasonally adjusted basis, average house prices fell by 0.2% between December 2014 and January 2015, compared to an increase of 1.0% in average prices during the same period a year earlier.
However the average price for properties bought by first-time buyers increased by 9.7% over the year to January 2015, up from an increase of 9.5% in December 2014. In January 2015 the average price paid for a house by a first-time buyer was £210,000.
The average price for properties bought by existing owners increased by 7.8% in the year to January 2015, down from an increase of 9.8% in December 2014. In January 2015, the average price paid for a house by a former owner-occupier was £314,000.
Alex Gosling, CEO of online estate agents HouseSimple commented:
"Such lukewarm results show the traditional January surge in demand for properties has not materialised. However, average prices are still well up on last year, and there's nothing to suggest the the property market has run out of steam.
"Talk of the boom times being over is a little premature. The market is likely taking a breather after a period of sustained growth over the past 18 months. Agents aren't short of buyer registrations, but sales are harder to come by because buyers are taking their time before committing to a purchase.
That is particularly the case in London, where this time last year there was a feeding frenzy amongst buyers to snap up properties in areas where prices were rising rapidly. Tighter lending criteria has clearly taken the wind out of the sails in the mortgage market, with a dip in mortgage availability in January.
"And first time buyers are having to save more and much longer before they can get a mortgage - although the introduction of the new Help to Buy ISA should help ease the financial strain.
"There may be uncertainty amongst buyers and sellers with a General Election looming, and we may see a slightly prosaic property market at a traditionally very busy time. But once the Election is over, there's nothing to suggest that it won't be business as usual."
Jonathan Samuels, chief executive of Dragonfly Property Finance, added:
"With inflation at 0%, a buoyant employment market and highly competitive mortgage rates, the property market may rebound sooner than expected from its current slowdown.
“Consumers will feel like they’re holding all the cards. Add a systemic shortage of property into the equation and there's now every chance average prices will start nudging up again in the months ahead.
"The average property price dipped marginally in January, and the annual rate of growth with it. But macroeconomic factors, coupled with a growing feel-good factor, could see the second half of the year prove much stronger than expected.
"Once the General Election is behind us, the property market could put the pedal to the floor again. The question is, of course, is this what we want? Almost certainly not is the answer if you place value on price stability."
