"The outlook for the U.K. economy and house prices, however, is more unclear than usual"
- Martin Ellis, a Halifax economist.
British house prices dipped for the first time in three month in January, after rising for two straight months, a sign that the property market is struggling to gain the momentum. The report by Lloyds Banking Group's Halifax division showed that home values dropped 0.2% last month to an average price of 162,932 pounds. At the same time, on a yearly basis, prices gained 1.1%. The report also showed that the outlook for the economy remains uncertain, also weighing on investors' willingness to purchase property in the U.K. Earlier this week, the National Institute of Economic and Social Research lowered their growth forecast to 0.7% from 1.1% and said stagnation likely to persist.
"The outlook for the U.K. economy and house prices, however, is more unclear than usual," said Martin Ellis, a Halifax economist. "Subdued economic growth and pressures on household finances are expected to constrain housing demand."
"The Funding for Lending scheme has helped lenders to lower interest rates and improve availability in the past few months," he added. "This is likely to have been a factor contributing to the pick-up in both home sales and prices."
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