The latest Land Registry House Price Index showed that house price inflation reached 6.9% in the year to October, down from 7% in the 12 months to September, delivering an asking price of £217,000 for the average home.
While prices were up annually in London by 7.7%, the Land Registry recorded a fall of 1.2% between September and October. Despite the fall, the cost of the average property in London is still the highest in the UK, setting buyers back an average of £474,000.
The picture of price growth was bleakest in the North East where house prices plummeted by 2.4% from September to October and grew by just 0.8% annually to reach an average price of £118,802.
Russell Quirk, founder and CEO of eMoov.co.uk, said with Christmas just around the corner, concerns about falling house prices should “be taken with a pinch of salt”.
“Not only will buyer demand drop right off as thoughts turn to the stress of the festive season, but many sellers will also freeze the marketing of their property, ready to hit the ground running again in January,” he said.
Across the UK, the main contribution to rising house prices came from England, where inflation increased annually by 7.4% to reach £233,000. Meanwhile, house prices in Wales increased by 4.4% over the last 12 months to stand at £147,000. Scotland was just behind as the average price rose by 4% annually to total £143,000, while prices in Northern Ireland increased by 5.4%, totalling £124,093.
Richard Snook, senior economist at PwC, added: “While the annual inflation rate remains high, prices have barely moved over the last three months. If this trend continues into 2017, we will see a pronounced drop in growth rates in the New Year. We project that UK house price growth for 2017 could range between 2% and 5%.”