Annual rate of growth moderates in final month of the year to 0.5% for the whole of 2018, compared with 2.6% for 2017
House prices declined by a modest amount between November and December, moderating the overall rate of growth in 2018.
The findings, from Nationwide’s monthly House Price Index, reveal a 0.7% fall in prices in December, meaning the average cost of a house in the UK rose by just 0.5% throughout 2018.
This is notably lower than the previous year’s rate of 2.6% and the lowest pace since February 2013, with the lender attributing the slow growth to the pervading economic uncertainty, weaker consumer confidence, and fewer new buyer enquiries towards the end of the year.
Nationwide highlighted the continuing trend of stronger and more stable rates of growth in the Midlands, Yorkshire, and the North of England (circa 3-4%) compared to slower growth or declines in London, the South, and the East.
On a quarterly basis, house prices were up by 1.3% in the UK compared with the same three-month period in the previous year, although it is nearly half Q4 2017’s rate of 2.1%.
Across England, annual house price growth for 2018 as a whole ended on 0.7%, with prices falling slightly by 0.1% in the final quarter of the year.
Looking ahead to this year, Nationwide’s Chief Economist Robert Gardner said: “The economic outlook is unusually uncertain. However, if the economy continues to grow at a modest pace, with the unemployment rate and borrowing costs remaining close to current levels, we would expect UK house prices to rise at a low single-digit pace in 2019.”
However, according to property website Home.co.uk, asking prices for residential property are predicted to drop across the UK by an average of 1% this year.