UK house price growth fell to its lowest level in six years last month, in a further sign that the market is weakening due to political uncertainty around Brexit, new figures show.
According to the latest Halifax house price index, prices fell from 1.5% in October to 0.3% in November - the lowest rate of growth since December 2012.
On a monthly basis house prices fell by 1.4% in November, taking the average price of a property to £225,995.
Russell Galley, managing director at Halifax, says: “High employment, wage growth and historically low mortgage rates continue to make home ownership more affordable for many, though the need to raise a significant deposit still acts as something of a restraint on the market.
“This is largely offset by relatively limited supply of new and existing properties for sale, which continues to sustain house prices nationally.”
Last month, Britain’s biggest lender Nationwide said that Brexit uncertainty appeared to be “holding back investment and dampening activity in the housing market”.
Its house price index painted a slightly better picture, with annual growth edging up slightly by 1.9% in November - up from 1.6% the previous month. However, monthly growth remained low at 0.3%.
Experts believe that house price growth will remain subdued until more is known about Britain’s exit from the European Union.
Dilpreet Bhagrath, mortgage expert at online mortgage broker Trussle, says: “House price growth is still slow due to a lack of activity in the market and we expect this to continue throughout the winter, until there’s more clarity around Brexit and we’re all on firmer footing."
She adds: “There’s also a huge amount of discussion about a looming interest rate rise, which will be putting upsizers off moving as they’ll be more wary of taking on more debt.”
Bank of England governor Mark Carney has warned that in the worst-case scenario a no-deal Brexit could spark an economic crash that could see house prices plummet by up to 30%. Mr Carney first gave a warning over house prices in September.
Mike Scott, chief property analyst at Yopa, says: “The usual Christmas slowdown in the housing market has started early this year, as people wait for the outcome of the current political turmoil before making long-term commitments, such as buying a new home."
He adds: “However, the economic fundamentals of low unemployment, low interest rates, growing wages and limited supply are all positive for house prices, and we therefore expect the market to pick up again in the new year.”