Cost of average UK home rises by just £14

The figures from property website Rightmove show the lowest monthly increase in the cost of the average home since records began in 2001.

The average house price in the UK is £362,452, up 3.9 per cent from last year.

Prices for newly listed homes remained flat between January and February, while interest from buyers was up 11 per cent compared with the same period in 2019, before the pandemic struck, the figures showed.

There were also 24 per cent fewer homes for sale compared with 2019, but more choice than a year ago.

The figures are said to show a period of “greater realism” on house prices, according to Tim Bannister Rightmove’s director of property science.

The company also said higher mortgage rates and and living costs are impacting what people can afford.

Bannister said: “Market conditions are demanding greater realism on price and we are transitioning into a slower-paced market, where buyers will take longer to find the right property at the right price due to the higher cost of servicing a mortgage”.

House prices in the UK fell for five months in a row up until January according to building society Nationwide, and this year is expected to register the biggest drop in house prices since the financial crisis.

Annual house price growth slowed to 1.1% this month, down from 2.8% in December.

Rightmove said house sales are down 11% from 2019 levels and had been down 30% during the aftermath of the mini-budget.

However, Tom Bill, head of UK residential research at estate agent Knight Frank, said the housing market has picked up since Christmas.

“Buyers and sellers switched off early for the holidays due to the volatility caused by the mini-budget but have come back surprisingly strongly in 2023,” he said.

Inflation – the rate at which prices rise – is near a 40-year high, putting pressure on household budgets.

The Office for Budget Responsibility has predicted a 9% drop in prices until Autumn 2024 before prices start to rise again.