The growth in house prices across the UK is a statistic watched with some concern by those entering the market for the first time. Steep rises can add years to a saving plan. In recent times the news has been reasonably good owing to a troubled economy, but for the first time in a year Nationwide has reported a growth of over 1%.
Nationwide is a building society using figures from internal mortgage data, and said that house prices rose by 0.1% in December compared to the month before. This meant that over 2019, prices rose by 1.4% year-on-year which, although larger than in recent years, represents a fairly stationary period in property.
This is good news for homeowners however, with slow increases better for first-time buyers.
Raising a deposit
The rise in December means the average UK home has a value of £215,282, according to Nationwide. This suggests that raising a deposit of 20% would take the full pre-tax income of the average worker.
Speaking to the BBC, Nationwide’s chief economist Robert Gardner said despite this rise, the housing market had shown relative stability. Strong employment paired with cheap mortgages means that, despite the economic cloud of Brexit, demand remains.
The concern for first-time buyers in the longer term is that with some clarity around Brexit possible on the horizon (following the election) and steady demand, there is a feeling amongst some industry professionals that this price growth could quickly accelerate.
London calling
Another element of the data that gives reason for further analysis is that of the capital. London performed the weakest of all regions surveyed in 2019, and prices rose regardless. Should the UK’s biggest city and economic hub see a better 12 months in the New Year, this could aid the acceleration.
The good news for those entering the market is that there is little to suggest a return to the explosive growth of the early-to-mid 2000s.
Scotland, meanwhile, showed the strongest growth of all regions for the first time in over a decade, whilst Wales saw more losses.
