House prices start 2018 showing a massive slowdown compared to last year – with Brexit uncertainty blamed.
And forecasters are predicting increases could slow to static as the uncertainty continues, against a national average growth rate of 7.5% in 2017.
While 15 of the fastest 20 risers were recorded in London and the South-East, towns in Wales, Yorkshire and the East Midlands also made the top 20, unlike last year when the list was dominated by the capital and southern England.
Latest data from mortgage lender Halifax shows prices in Cheltenham rising more rapidly than in any other part of the UK in 2017 – jumping by 13% during the year from £36,033 to £313,150.
Perth in Scotland saw the steepest fall.
Bournemouth and Brighton were in second and third place respectively, both experiencing price rises of more than 11%.
Huddersfield also made the top 10 with growth of 9.3%, while Swansea saw the biggest jump of any area in Wales, up 7.7% to £164,895.
The largest increase in cash terms was felt in the London borough of Richmond upon Thames, where a 7.6% rise in house prices saw the average home rise by £45,463 to hit £646,112.
The average in Richmond is now more than three times the price of a home in Perth – the area that saw the largest fall in prices.
According to Halifax, which based its data on successful mortgage applications in 119 towns and 24 London councils, homes in Perth declined in value by 5.3%, or £10,125 in cash terms, to an average of £190,813.
That puts Perth at the top of a list of just 13 towns or city boroughs where house prices fell in 2017, eight of them in either Scotland or Yorkshire and the Humber.
Stoke-on-Trent saw the second biggest fall, down 4% to an average of £152,340, with Paisley in third place, after a 3.6% fall to £123,665.
Other towns where house prices fell include Wakefield, Rotherham and Barnsley in Yorkshire, as well as Dunfermline and Aberdeen.
While the vast majority of towns saw an increase in 2017, housing market commentators have predicted the steady increases seen in recent years could grind to a halt in 2018, particularly in London and the South-East, citing the twin spectres of Brexit and rising interest rates.
Of the two big lenders that operate closely watched price indices, Nationwide has said it expects property values to be ‘broadly flat’ in 2018 with the ‘maybe’ of a marginal gain around 1%”.
Halifax predicts growth in the range of 0%-3%.
Prospects for London – where Savills records house price growth of 70% over the past decade – are more downbeat, with some economists even forecasting a slide into negative territory.
According to a Reuters poll of 28 housing market specialists, property prices will rise by 1.3% nationally, but fall by 0.3% in London.
The former figure is less than half the current rate of consumer price inflation.
Forecasters have pointed to economic and political uncertainty leading up to the UK’s exit from the European Union in 2019, as well as the rising cost of mortgages if the Bank of England raises the base rate again, having increased it for the first time in a decade from 0.25% to 0.5% in November.
Ashley Osborne, head of UK residential with Colliers International said there was “no doubt” that UK house price growth would slow over the year – with his prediction being a growth rate of 1.5%.
“But it’s not all bad news, a welcome change to stamp duty with the news first-time buyers would be exempt for properties up to a value of £300,000, applicable as long as they were purchasing a home worth less than £500,000 will no doubt help ease this group of buyers path to home ownership.
“Increased funding for government initiatives such as Help to Buy will also give a boost to properties priced at £600,000 and below.
“The rise in interest rates may seem significant simply because there hasn’t been one for such a long period, but in actual fact mortgage rates are still historically low.
“Lastly, the fundamental shortage of housing will continue to underpin the market for the next year, regardless of the outcome of Brexit negotiations as the government is notably short of its target to build 300,000 new homes a year.
“All in all, while it’s unlikely 2018 is going to be a standout year for the housing market, given the political and economic uncertainties the UK is facing, things could be a lot worse,” he said.