"U.K. house prices continue to be supported by an ongoing shortage of property for sale, low levels of house building, and exceptionally low interest rates". – Martin Ellis, Halifax
House prices in the United Kingdom dropped unexpectedly last month, official figures revealed on Tuesday. Halifax reported its House Price Index, the longest running monthly house price measure, plunged 0.6% in January, following the preceding month’s downwardly revised increase of 1.6%, while market analysts expected house prices to grow at a 0.2% pace in the reported month. The January figure marked the first monthly decline since the Brexit vote. On an annual basis, prices climbed 5.7% last month, down from December’s 6.5% and below economists’ forecasts. In a report, Halifax said that a lack of properties for sale, low interest rates and slow building activity would push house prices higher in the upcoming months. However, it also stated that subdued economic growth and rising pressure on consumer spending could probably weaken house price growth. In January, the average house price was 220,260 pounds. Last week, the British mortgage lender Nationwide said the average house price rose 0.2% on a monthly basis in January, following the previous month’s 0.8% increase. Year-over-year, house prices grew at a 4.3% pace last month, the weakest since November 2015, compared to the December increase of 4.3%. According to Nationwide, the housing market would lose some momentum going forward.