Annual house price growth was 8.4% in July down from 9.9% in June and the recent peak of 10.6% in May, with the average property valued at £212,878.
Seasonally adjusted, July figures were 4.7% below the peak in April 2008, but 11.1% above the trough recorded in April 2009.
In the quarter to July 2010, house prices grew 0.8% compared to an increase of 1.1% for the quarter to April.
Across the regions of the UK there were distinct differences in annual house price inflation, with England recording growth of 9%, while Wales saw a 10.1% rise and Scotland saw a 3.7% increase.
However, Northern Ireland recorded a fall in annual average house prices of 17.1%.
The CLG revealed that the annual growth in house prices for first-time buyers fell in July to 7.5% compared to 10.3% in June, reflecting a monthly drop of 1.2% in July compared to an increase of 1.4% for the same period last year.
Former owner-occupiers also saw annual house price growth fall from 9.8% in June to 8.7% in July.
The average price paid by first-time buyers in the UK in July was £156,040 compared to £247,918 paid by former owner occupiers.
CLG figures also showed that the average price paid for new build properties was 9.5% up on a year ago compared to 9% in June, while the annual growth rate for pre-owned dwellings was 8.3%, down from 10% in June.
The average price paid for a new property in July was £192,665 and the average price paid for a pre-owned property was £214,474.
