House prices went down 1.5% in last month of the year according to the Halifax

house prices

UK house prices dropped 1.5% between November and December last year, Halifax data has shown, the fourth successive month of price declines.

A typical UK house cost £281,272 in the last month of 2022, down from £285,425 in November, the bank said today. The annual rate of growth dropped to 2% in December, from 4.6% in November. 

However, the month-on-month drop of 1.5% was less than the 2.4% fall registered between October and November. 

This echoes other house price indices that have come out recently, such as that of the Nationwide, which showed the cost of an average house went down 0.1% between November and December last year. 

Rightmove found house prices in the UK dropped by 2.1% between November and December last year, the biggest fall for four years.

Kim Kinnaird, director of Halifax Mortgages, pointed out the average cost of a house remained high - more than 11% above the start of 2021. 

She said: “The first half of last year was a very strong period for sellers, between January 2022 and August 2022, the average cost of a home rose by over £17,000 to £293,992 (growth of 6%), setting a new record high.”

She highlighted the market slowed down in the second half of the year with the cost of living increases and rising interest rates. The Bank of England put the base interest rate up to 3.5% last month, the highest for 14 years. House prices also took a hit after September’s disastrous mini-Budget last year. Kinnaird added: “As we enter 2023, the housing market will continue to be impacted by the wider economic environment and, as buyers and sellers remain cautious, we expect there will be a reduction in both supply and demand overall, with house prices forecast to fall around 8% over the course of the year.” 

Just before Christmas, Zoopla predicted annual house price growth would fall in the middle of this year. 

The Halifax data released today showed annual house price inflation slowed in all the nations and regions of the UK, but the North East showed the greatest slow down. Annual house prices rose by 6.5% in the North East, compared to 10.5% the month before.