The annual percentage change for average UK house prices was 6.3% in the 12 months to January 2023, compared with 9.3% in the 12 months to December 2022 and 10.2% in the 12 months to November 2022.
The average UK house price was £290,000 in January 2023, which is £17,000 higher than 12 months ago.
Average house prices increased over the 12 months to £310,000 (6.9%) in England, to £217,000 in Wales (5.8%), to £185,000 in Scotland (1.0%) and to £175,000 in Northern Ireland (10.2%). On a non-seasonally adjusted basis, average UK house prices decreased by 1.1% between December 2022 and January 2023, while average UK house prices increased by 1.7% during the same period 12 months ago. This caused the UK annual inflation rate to slow this month.
Annual house price inflation was highest in the North East where prices increased by 10.0% in the 12 months to January 2023.
The lowest annual inflation was in Scotland, where prices increased by 1.0% in the 12 months to January 2023.
The South West showed a rise of 7.1%.
London was the English region with the lowest annual growth, where prices increased by 3.2% in the 12 months to January 2023.
However, Scotland saw lower annual inflation than London, with prices increasing by 1.0% in the 12 months to January 2023.
Scotland annual house price inflation slowed this month because average prices decreased by 0.5% between December 2022 and January 2023, while average Scotland house prices increased by 3.4% during the same period 12 months ago.
The Royal Institution of Chartered Surveyors’ (RICS’) January 2023 UK Residential Market Survey reported a muted market backdrop at present, with new buyer demand, sales, fresh listings and prices all reported to be on a downward trend.
Near-term expectations suggest this picture is likely to remain in place for a while longer as the market adjusts to the higher interest rate environment. The Bank of England’s Agents summary of business conditions 2022 Q4 reported the supply of homes for sale increased faster than demand with higher borrowing costs and concerns about affordability weighing significantly on demand from first-time buyers.
The UK Property Transactions Statistics showed that in January 2023, on a seasonally adjusted basis, the estimated number of transactions of residential properties with a value of £40,000 or greater was 96,650.
This is 10.6% lower than 12 months ago (January 2022). Between December 2022 and January 2023, UK transactions decreased by 2.6% on a seasonally adjusted basis.
In England, the January data shows that, on average, house prices have fallen 1.2% since December 2022. The annual price rise of 6.9% takes the average property value to £310,159.
Commenting on first-time buyers, Co-founder and CEO of Wayhome, Nigel Purves, said: “The average price paid for a first home has fallen at a sharper rate than the wider market, while the annual rate of growth also remains lower, and this will be welcome news for the nation’s first-time buyers who face the toughest task when climbing the ladder.
“However, the average price of a first home remains 6.1% higher than it was just a year ago, which demonstrates the growing pressure being placed on the nation’s first-time buyers when it comes to the cost of homeownership.
“Unfortunately, it doesn’t appear as though they will be offered a helping hand anytime soon, with the Government choosing to ignore first-time buyers in last week’s spring statement. With the final Help to Buy deadline also expiring this month, they are left with no other choice but to go it alone and we expect this task will become all the greater with another increase in interest rates on the cards tomorrow.”