Belfast Telegraph

Spending squeeze to cause house price growth to slow

By Vicky Shaw

House prices will continue edging upwards across 2017, but the rate of growth will slow as households see their spending power squeezed, according to a forecast.

Halifax said in March 2016 house prices were increasing at an annual rate of 10% - but the pace of growth has been a downward trend since the spring.

By the end of 2017, it expects growth across the UK to be running between 1% and 4%.

It said the relatively wide range for its forecast "reflects the higher than normal degree of uncertainty regarding the prospects for the UK economy next year".

Halifax said it is "most likely" that the economy will soften over 2017 and lower levels of house sales could take place as more people respond to weaker economic conditions and a deterioration in housing affordability by not buying or moving home.

Halifax's housing economist, Martin Ellis, said: "The housing market is critically dependent on how the wider economy evolves. We consider it most likely that the UK economy will soften over the course of 2017.

"This is most likely to result from the weakening of sterling pushing up import costs and dragging on purchasing power."

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