The August UK House Price Index showed the average property value in the UK was £225,956, but London’s performance was a notable exception – the capital saw the lowest annual price growth and the most significant monthly price fall. It experienced an annual price increase of 2.6%, with a 1% fall since July.
Wales also witnessed sluggish price performance, with prices up 3.4% on the year and down 0.1% since July.
In England, the August data showed an annual price increase of 5.3%, taking the average property value to £243,520. House prices rose by 0.7% since July 2017.
The North West experienced the greatest increase in average property price over the last 12 months, with a movement of 6.5%. It also saw the greatest monthly price growth: an increase of 2.3% since July.
This was followed by the South West, East of England and the East Midlands; all of which had a growth rate of 6.4% in the year to August 2017.
Steady price growth
Richard Snook, senior economist at PwC, said the data shows relatively little movement in price growth from the previous month.
“London remains the weakest performing English region and the August figures show the average price of a home fell by £5,000 to £484,000. Prices are now just 2.5% higher than they were a year ago. With overall consumer price inflation at 2.7% in August, this means London’s house prices declined in real terms.”
He suggested the uncertainty over Brexit may be felt more keenly in London than other areas due to the importance of international businesses.
“Figures from the City of London borough bear this out where prices are down 18.4% compared to a year ago.”
Founder and CEO of eMoov.co.uk Russell Quirk said the modest growth was positive given “turbulent market conditions”.
“While a slowing London market may be putting a dampener on the overall forecast, England continues to lead the way where prices are concerned with many areas seeing strong annual growth,” he said.
“It’s testament to the diversity and resilience of the UK market that this growth is spread across the North West, South West, East and Midlands.
With a sustained level of buyer interest, albeit more cautious than usual, the market should weather any potential storm on the horizon, with the dark clouds of recent market uncertainty already starting to lift.”
Yet Jeremy Duncombe, director of Legal and General Mortgage Club, said annual prices were consistently rising as more buyers chased fewer properties.
“Escalated by a critical a lack of housing stock, this trend is only set to continue if more affordable housing is not built. As speculation around the Autumn Budget begins to build up, we hope there will be a genuine answer to boost supply that gives everyone a realistic the chance to own a home.”