UK House Price Index ‘path of price rises far from smooth’

For all the reassuring familiarity of the headline growth figures, the path of Britain’s property price rises is far from smooth.

On an annual basis, every part of the UK saw average prices rise in October. But dig deeper into today’s official data and the momentum looks less assured.

Prices fell in four out of the nine English regions compared to the previous month, and on the front line we’re starting to see price inflation cool.

While there is no shortage of buyers, those planning a move are increasingly pragmatic and price-sensitive. This sense of caution is likely to heighten following November’s sharp increase in consumer inflation – which is eating into people’s disposable income and could delay next year’s long hoped-for reduction in interest rates.

As a result we’re seeing some buyers reassessing what they can afford. The glut of homes for sale means they’re often spoilt for choice, and this is giving them the confidence and leverage they need to negotiate hard on price.

This is a healthy market, with plenty of both supply and demand. But with the prospect of cheaper mortgages now likely to be off the table for several months as the Bank of England once again battles to tame inflation, price growth over the next few months is likely to be modest at best.