House prices increased by 1.7% between November and December, the Halifax has reported. 

This maintained the fluctuating monthly house price pattern seen during the second half of 2015.

However, Halifax said that the quarter-on-quarter change is a more reliable indicator of the underlying trend. This found that house prices in the last three months of 2015 (October-December) were 1.6% higher than in the preceding three months (July-September). The quarterly rate of change remained below 2.0% for the second successive month; its lowest values during 2015.

Prices in the three months to December were 9.5% higher than in the same three months a year earlier.This was a little higher than November’s 9.0%, keeping the annual rate in the 8-10% range where it was for nearly all of 2015.

Martin Ellis, Halifax housing economist, said: “House prices in the three months to December were 1.6% higher than in the previous three months. This was the second successive month that this measure has been below 2.0%, indicating a possible slight softening in the underlying rate of price growth.

“There remains, however, a substantial gap between demand and supply with the latest figures showing a further decline in the number of properties available for sale. This situation is unlikely to change significantly in the short-term, resulting in continuing upward pressure on prices.”

Newham in London recorded the biggest rise in house prices among major UK towns and cities over the past year, according to separate recent research by Halifax. The average house price in the London borough was 22% higher than in the previous year; nearly double the 12% increase in London as a whole. Those areas that have seen the biggest house price increases over the past year are either in outer London or within close commuting distance of the capital.