Annual house price growth dips from record high: UK HPI

November marked the first monthly decline in house prices since October 2021.

Related topics:  Finance News,  House prices
Rozi Jones | Editor, Barcadia Media Limited
18th January 2023
House sale sign sold
"Although today’s statistics show a decline in the rate of house price growth, it’s important to recognise that figures are still on par with pre-pandemic level and remain relatively strong."

Average UK house prices increased by 10.3% in the year to November 2022, down from 12.4% in October, according to the latest UK House Price Index from the ONS and Land Registry.

The average UK house price was £295,000 in November, which is £28,000 higher than this time last year but a slight decrease from last month's record high of £296,000.

Average house prices increased over the year by 10.9% in England, 10.7% in Wales, 5.5% in Scotland, and 10.7% in Northern Ireland.

Scotland's annual house price inflation has generally been slowing since April 2022 when it was 14.2%.

The North West saw the highest annual percentage change in the year to November (13.5%), while London saw the lowest (6.3%) of all English regions.

On a non-seasonally adjusted basis, the average UK house price decreased by 0.3% between October and November, the first monthly decline in prices since October 2021.

Vikki Jefferies, proposition director at Primis, commented: “Although today’s statistics show a decline in the rate of house price growth, it’s important to recognise that figures are still on par with pre-pandemic level and remain relatively strong.

“With rate reductions likely to continue as the new year gets underway and with growing numbers of products returning to market, brokers need to be prepared to help homebuyers and remortgagers make informed choices when it comes to the best product for them. As economic turbulence continues, this involves thinking about future impacts, as well as shorter term outcomes. Increasingly, advisers have a range of tools available to help insulate borrowers to an extent from fluctuating market changes, including increasingly flexible products coming to market, such as those allowing customers to switch on to more affordable rates, should these fall.

“From a lender’s perspective, there is certainly appetite to lend, and we’re seeing clear creative thinking and enhanced proposition development in order to create flexible products that meet customer needs at this time. Overall, independent advice remains essential for homebuyers looking to secure the best deals and benefit from guidance tailored to their unique personal and financial needs.”

Emma Cox, MD of real estate at Shawbrook, said: "The positive spell we’ve seen in the markets as of late will help to shine a ray of hope for the property market in 2023, but today’s house price figures show there’s still some catching up to do. November’s positive 0.1% GDP growth and the rallying of the FTSE to record highs will certainly help to improve confidence among buyers and sellers, and we expect this will be reflected in transaction activity in coming months. Nevertheless, there are still many first-time buyers feeling the effect of inflation and rising energy costs, which are hampering their ability to get onto the property ladder.

“If the economy continues on its positive trajectory into the next quarter, it could signify a ‘light at the end of the tunnel’ for first-time buyers, but landlords will also need to pay close attention as competition could soon return to the market. The seeds of economic improvement quickly spread, and I expect we’ll see many professional landlords working hard to provide a compelling rental offer for tenants in a busy lettings market whilst growing their portfolios with new purchases."

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