BBC News and The Telegraph featured Anna’s comments on the softening of house price growth, as reflected in Halifax’s January house price data.

Quick summary and links to the articles below:

House price growth has slowed to 5.4% growth in the year to January 2021 according to Halifax.

This is still a significant rate of growth, in particular compared to many other more volatile or low return assets.

There’s been three major drivers of house price rises in 2020: the temporary Stamp Duty Land Tax reduction, cheap debt as a result of very low interest rates, and the release of pent up supply and demand and desire to improve surroundings amongst homeowners.

The temporary SDLT reduction has had a more than proportionate impact on prices, since buyers using mortgages can take debt out on the property price, but cannot include transaction costs. The slowdown we are now seeing in house price growth reflects the looming end to this incentive.

Looking to the future, when (assuming) the temporary SDLT reduction ends, we’re likely to see a slowdown in house price rises. Challenging economic conditions make potential home buyers less willing and able to buy.

The good news for the property market is that throughout market cycles and changes, house prices in the UK have historically remained stable.  Typically, house prices will rise more slowly rather than falling, in the majority of locations, since we all need a roof over our heads and supply of new homes is limited.