Growth in UK house prices eased in January, according to the Nationwide.

Prices were 0.1% up in January following a 0.7% rise in December – the latest rise was lower than the expected 0.3%.

On the year, prices rose 4.1% in January following a 4.7% jump the month before and the average price of a home is now £268,213, down from £269,426.

Nationwide chief economist Robert Gardner says: “The market continues to show resilience despite ongoing affordability pressures … While there has been a modest improvement over the last year, affordability remains stretched by historic standards.

“A prospective buyer earning the average UK income and buying a typical first-time buyer property with a 20% deposit would have a monthly mortgage payment equivalent to 36% of their take-home pay – well above the long-run average of 30%.

“Furthermore, prices remain high relative to average earnings, with the first-time buyer house price to earnings ratio standing at 5.0 at the end of 2024, still well above the long run average of 3.9. Consequently, the deposit hurdle remains high.

“This is a challenge that has been made worse by the record increase in rents in recent years, which, together with the cost-of-living crisis more generally, has hampered the ability of many in the private rented sector to save.”