The 20-city house price index by Hometrack has registered annual house price inflation of 2.6%, which is the lowest annual rate of growth for five years. Meanwhile, house price inflation in London has ended 2018 with price falls for only the second time in 23 years. Hometrack says that affordability will set the framework for future growth, and is predicting 2% house price growth in 2019.

City house price inflation lowest for five years
The 20-city index is registering house price inflation of 2.6%, the lowest annual rate of growth for five years. The average price of a home has increased by £6,500 over the last 12 months to £253,500.

Price falls in London and a sustained slowdown across cities in southern England are impacting the headline rate of growth. Edinburgh is currently the fastest growing city (up 6.6% in 2018) with price rises in Manchester and Birmingham also running at more than 6%.

Just four cities are registering growth higher than a year ago
There are just four cities where price growth today is higher than at the same time last year – Manchester, Liverpool, Cardiff and Newcastle. The remaining 16 cities are all registering slower growth.

Cities in southern England such as Bristol, Portsmouth and Bournemouth have registered the greatest slowdown on the back of increasing affordability pressures. These cities have the highest price to earnings ratios outside of London, Oxford and Cambridge.