House price growth lowest for a year, says Nationwide
The annual pace of house price growth is now at its slowest for a year, according to the UK's second biggest mortgage lender.
Nationwide said house price inflation fell to 7.2% in December on an annual basis, down from 8.5% in November.
However, activity in the housing market is likely to pick up in the months ahead, Nationwide said.
Monthly house prices rose by 0.2% in December, taking the average house price up to £188,559.
"The pace of annual house price growth continued to soften as 2014 drew to a close," said Nationwide's chief economist, Robert Gardner.
Year on year % change
Mr Gardner said the slowdown in the housing market was "surprising given further steady gains in employment, a pickup in wage growth (albeit from low levels) and the continued low level of mortgage rates" in the UK.
"If the economic backdrop continues to improve as we and most forecasters expect, activity in the housing market is likely to regain momentum in the months ahead," he added.
A pick-up in the housing market a year ago was also a factor in the slowing annual increase in prices. That is part of the reason for the annual price rise for 2013 being faster than 2014.
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The national average masks a big regional difference in annual house price changes, according to analysis by the Nationwide of its own mortgage data.
As has been the case throughout 2014, London prices grew at a much faster rate in the final quarter of the year than in the rest of the UK.
There was a 17.8% increase in the final three months of the year compared with the fourth quarter of 2013. This took the average price in the city to £406,730, some 35% above their previous peak in 2007.
All regions saw the annual rate of increase slow, but they all recorded price increases for the year as a whole.
Prices rose slowest in Wales, which showed a 1.4% rise over the same period. The average home in Wales was valued at £141,631.
|Annual change in house prices|
|Region||Annual change||Average price|
|Outer South East England||10.6%||£235,538|
|South West England||8%||£210,847|
|North West England||3.8%||£145,212|
|Yorkshire and the Humber||1.5%||£142,816|
|Source: Nationwide Q4, 2014|
House price figures from the Land Registry were also published on Tuesday, although the the data lags behind the Nationwide figures.
Figures for the year to November in England and Wales suggested the fastest regional growth year-on-year was in London and the slowest was in Wales.
Its figures showed that semi-detached homes and flats saw the fastest rise in prices over the same period, up 7.9%.
Terraced homes recorded the slowest rise, up 6.3%.
Overall, the Land Registry said that prices fell by 0.1% from October to November. The annual change was an increase of 7.1% and the average price of a property in England and Wales was £176,581.