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UK house prices fall in January

The average price of a home fell in January for the first time in five months, as inflation in the UK continued to slow.

Research from Nationwide indicates that prices fell by 0.1 per cent, coming down from £188,446 in January to £187,964, while annual house price growth slowed for the sixth consecutive month.

The amount of home loans that were approved in January was also below the six month average, standing at 60,786, a small rise from the 60,349 approved in December, according to figures released by the Bank of England.

Nationwide’s chief economist, Robert Gardner said: “Mortgage rates remain close to all-time lows and consumer confidence remains buoyant thanks to a further steady improvement in labour market conditions”.

However, the market has continued to cool and Nationwide has said that the catalyst for this could be the long-term decline in the number of young first-time buyers in the market. Between 2004 and 2014 the number of households where the main occupant is aged between 24 and 34 where the home is owned and not rented fell by 23 per cent, from 59 per cent to 36 per cent.

On the other hand, the number of people who are homeowners and have either managed to complete mortgage repayments or have bought a home mortgage-free overtook the number of people who own their property but are still making mortgage repayments.

With the general election approaching, most major political parties have outlined plans to get more young first-time buyers onto the property ladder using a housebuilding programme, while the current government has said that it will offer a discount of up to 20 per cent to first-time buyers as part of its ‘Starter Homes’ scheme.

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