House prices almost recovered to their March peak at the end of 2016 but transactions were down 3.9%, according to the latest Your Move House Price Index.
The figures for last month show prices grew 0.4% in December, up 3.1% year-on-year to £297,678. The figure is close to Rightmove’s new average asking price of £300,245 for properties coming on to the market within the last month.
The Your Move figure takes the average house price almost back to the £297,725 peak reached amid the Stamp Duty rush of the previous December.
However, the annual rate of growth was down from 3.5% in November and transaction figures for the final six months of 2016 show just how big an impact the Stamp Duty reforms had as sales fell by 14.7% year-on-year for that period, according to the index.
There was a lot of variation across the country with annual price growth as high as 16.2% in Hull while falls have been as deep as -11.5% in the London Borough of Hammersmith & Fulham.
Overall, London has trailed the other regions of England and Wales, with house price growth of just 0.2%.
The east of England saw the biggest annual increase in 2016, up 7.9% to £315,134.
Oliver Blake, managing director of Your Move and Reeds Rains estate agents, said: “It was a strong finish to an uncertain year. Despite the doubts over Brexit, prices have continued to grow, powered by good-value commuter properties.
“As the lower transaction figures since April show, the market faces challenges ahead, but it has entered 2017 a lot stronger than many would have expected.”
In terms of property coming to market, Rightmove claims there is now an opportunity for first-time buyers as there is less buy-to-let interest than a year ago.
While the number of sales agreed of smaller properties – two bedrooms and under – was down 13.2% in December 2016 compared to the same month in 2015, Rightmove attributes this to fewer buy-to-let investors. As a result, Rightmove says, available stock for sale in this sector is up 1.9% compared to last year. This contrasts with January 2016 when availability of this kind of stock fell by 18%.
Overall, the average asking price in January 2017 has been recorded at £300,245, up 0.4% since December and 3.2% annually.
The average time taken to sell increased to 72 days in December, up from 67 in November, while average stock per agent fell from 56 on average per agent to 51 over the same period.
Miles Shipside, Rightmove director and housing market analyst, said: “The 0.4% monthly and 3.2% year-on-year price increases are indicators of the continued market momentum from the autumn.
“Demand for a suitable home is such that visits to the Rightmove website are still up by 5% year-on-year, despite being compared to a period that was boosted by high demand from buy-to-let investors rushing to beat the Stamp Duty deadline.
“Year-on-year comparisons for transactions in the first quarter of 2017 should also allow for the distortion of last April’s additional Stamp Duty tax deadline, as transactions were up 40% in the first quarter last year.”