Average house prices in the UK have increased by 3.2% in the year to August 2018 and, despite being down from 3.4% in July 2018, have remained broadly stable at a national level since April 2018, new data has revealed.
The Office for National Statistics published its UK House Price Index: August 2018 today and found that the average UK house price was £233,000 in August 2018, which is £7,000 higher than in August 2017 and £1,000 more compared to last month.
When looking at house prices on a non-seasonally adjusted basis, average prices increased by 0.2% between July 2018 and August 2018, compared with an increase of 0.5% during the same period last year. However, on a seasonally adjusted basis, the average prices in the UK increased by 0.3% between July 2018 and August 2018.
When analysing house price growth in each individual country, the ONS found that prices in England increased by 2.9% in the year to August 2018, down from 3.3% in the year to July 2018, with the average price now being £250,000.
Prices in Wales have increased by 6.2% in the past 12 months to reach £162,000, while in Scotland they increased by 4.1% with the average now standing at £153,000. The average house price in Northern Ireland is currently at £133,000, an increase of 4.4% over the year to quarter two 2018.
The office highlighted that the slowdown of house price growth in England is being driven by the South and East of the country, with prices increasing by just 1.6% in the year to August 2018, compared with growth of 5.8% in the Midlands and 3.4% in the North of England.
Commenting on the figures, Foundation Home Loans marketing director Jeff Knight said: “On the face of it, the fact house prices are not increasing steadily means there’s more opportunity for first-time buyers. However, market uncertainty has meant existing buyers are stalling.
“It’s crucial to recognise how ongoing political uncertainty and regulation impacts the market – making the case for a good supply of rental properties even more necessary. Ongoing activity may be slowing, but ensuring a consistent supply is crucial to keep momentum ticking over in the interim. Given the financial climate, it’s also fair to say we will see numbers of people requiring additional support from specialist offerings increase.”
Trussle mortgage adviser Dilpreet Bhagrath added: “There are a number of reasons why house prices are barely moving and even falling in some parts of the UK. Subdued economic activity and ongoing pressure on household budgets is putting people off moving, so there is less demand from new buyers. Many people are also hesitant due to Brexit negotiations.
“Many homeowners will be concerned about seeing equity they’ve built up over the years eroded by falling house prices, however a fall in house prices isn’t necessarily long-term. In the meantime, first-time buyers are slowly seeing their perspectives rise. Not only are house prices slowing, but the average two-year fixed rate mortgage has fallen for the first time in 12 months, despite two base rate rises, helping to ease the cost for borrowers.”
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