House prices will rise 2% in 2017, as Brexit uncertainty and stretched affordability continue to weigh on the market, according to Rightmove.
Property prices have risen 3.4% over the past year to £299,159, despite falling 2.1% – or £6,511 – in November.
Rightmove said this dip was “usual” for this time of year and in line with the seasonal average of the last six years.
While the rate of growth has slowed, it is still the seventh consecutive year of rising property prices.
However, the online property portal predicts inner London property prices will fall by a further 5% in 2017 as its price bubble continues to deflate.
Miles Shipside, Rightmove director and housing market analyst, said: “As well as prices moving out of reach for some buyers, the sword of Brexit uncertainty hangs over the market, an unknown factor that may – or may not – have damaging consequences for the economy and confidence.
“There was a bout of jitters with the unexpected referendum result, albeit now seemingly short-lived, but more may arrive after Article 50 is invoked. For the time being any nervousness is being over-ridden by high demand for the short supply of suitable homes for sale in the lower and middle market in many parts of the country.”
Jeremy Duncombe, director of Legal & General Mortgage Club, said: “November’s figures are following the trend set by the previous month by showing a slight decrease in house price inflation.
“The problem – as ever – is that wage inflation is continually being outstripped by house price inflation. Until we realign these two fundamental elements of the market, first time buyers will continue to struggle to get on the housing ladder. With the promised Housing White Paper due at the start of the New Year, it is time for the Government to start tackling the structural problems in the housing market.”
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