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UK house prices will barely rise in 2018, Nationwide forecasts
[LONDON] UK house prices will barely gain this year after slowing markedly in 2017, according to the latest forecast from Nationwide Building Society.
The lender sees property-price inflation of about one per cent, less than half the 2.6 per cent pace recorded last year, it said on Thursday. Even that marked a sharp slowdown from 2016, when values jumped 4.5 per cent.
Housing has cooled over the past year, with factors from an inflation squeeze to Brexit uncertainty weighing on demand. Bank of England data due on Thursday is forecast to show that approvals for mortgages fell to a 15-month low in November. That's the same month the central bank raised interest rates for the first time in a decade.
London has taken the brunt of the slowdown after years of surging values that stretched first-time buyers. On Nationwide's metric, it was the weakest region for the first time since 2004, with the first annual decline in eight years.
Nationwide's property-market outlook is broadly in line with other forecasters, which see limited price growth nationally and declines in the capital. According to the lender, London will be the weakest region in 2018, recording a 0.5 per cent decline.
Nationwide said UK house prices prices rose 0.6 per cent in December from November, though monthly figures can be volatile.