According to the latest House Price Index from Halifax, UK house prices rose by 1.1% in December, that’s the third monthly rise in a row.

Property prices overall increased by 1.7% in 2023.  That said, Halifax is predicting house prices to fall between 2% and 4% during 2024.

Kim Kinnaird, Director, Halifax Mortgages, said: “The housing market beat expectations in 2023 and grew by +1.7% on an annual basis. Whilst it’s encouraging that we saw growth in the last three months of the year, this was preceded with property price falls for six consecutive months between April and September. The growth we have seen is likely being driven by a shortage of properties on the market, rather than the strength of buyer demand. That said, with mortgage rates continuing to ease, we may see an increase in confidence from buyers over the coming months.”

Considering the outlook for 2024, Mr Kinnaird said: “As we move through 2024, the UK property market will continue to reflect the wider economic uncertainty and buyers and sellers are likely to be naturally cautious when considering making a move. While wage growth is now above inflation, helping to ease cost of living pressures for some and improving housing affordability, interest rates are likely to remain elevated for as long as inflation remains markedly above the Bank of England’s target. Our latest forecast suggests house prices could fall between -2% and -4% during the coming year, although, as with recent years, forecast uncertainty remains high given the current economic climate.”

Iain McKenzie, CEO of The Guild of Property Professionals, commented: “A rise in house prices in December is a clear indication that the market is starting to recover after a year of downward pressure. The South East has been the worst affected by sluggish market activity, but it’s always worth bearing in mind that prices in this part of the country have been inflated for some time, becoming increasingly unaffordable for first-time buyers without financial support. Property prices in Northern Ireland defied the trends elsewhere in the UK and rose by just over 4%. Property sales show a 22% decline, which reflects this lack of mortgage competition. However, the demand for quality housing is propping this figure up, with high rent rates pushing more people to want to buy.”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, said:  “What a difference a year makes, as it was only 12 months ago when forecasts projected steep falls for house prices. Although there is a huge disagreement between Halifax’s 1.7% price rise for the year and Nationwide’s 1.8% fall, the property market has performed far more strongly than many analysts predicted. There are many reasons for optimism as we head into the new year. Economic stability is encouraging lenders to offer increasingly competitive mortgage rates, widening affordability for buyers and driving activity. Many buyers are highly motivated to move, having held off on their plans while waiting for the economy to improve. Their patience is being rewarded, and they are benefiting from greater availability of properties. The post-Christmas period is seeing a spike in sellers keen to capitalise on the momentum generated by falling inflation and the rise in consumer confidence.”