House price growth slowed to 0.5% in the year to December 2018, Nationwide’s House Price Index has found.
Prices fell by 0.7% from November to December to average at £212,281.
Annual house price growth has slowed considerably since December 2017, when it stood at 2.6%.
Robert Gardner, Nationwide’s chief economist, said: “UK house price growth slowed noticeably as 2018 drew to a close, with prices just 0.5% higher than December 2017.
“This marks a noticeable slowdown from previous months, where prices had been rising at a c2% pace. However, it is broadly in line with our expectations (since the start of the year we had been anticipating a price rise of c1% in 2018).
“Indicators of housing market activity, such as the number of property transactions and the number of mortgages approved for house purchases, have remained broadly stable in recent months, but forward-looking indicators had suggested some softening was likely.
“In particular, measures of consumer confidence weakened in December and surveyors reported a further fall in new buyer enquiries towards the end of the year. While the number of properties coming onto the market also slowed, this doesn’t appear to have been enough to prevent a modest shift in the balance of demand and supply in favour of buyers.”
As ever, the headline figures mask significant regional disparities.
Between Q4 2017 and Q4 2018 Northern Ireland saw annual growth of 5.8%, followed by the East Midlands and Wales at 4.0%.
The London commuter belt saw prices fall by 1.4%, while they also fell by 0.8% in London and stayed flat in outer South East England.
Andy Soloman, property expert and Yomdel chief executive, said: “The market is still being dragged kicking and screaming by the confidence across a number of regional front runners and these stronger performances from the likes of the Midlands, Yorkshire and the North West are proof that the UK property market isn’t ready to give up yet.”