Average house prices in the UK have increased by 3.1% in the year to July 2018, slightly down from 3.2% in June 2018, and marking the lowest UK annual rate since August 2013 when it was 3%,the UK House Price Index published by the Office for National Statistics (ONS) has revealed.
The index reported that the annual growth rate has slowed since mid-2016 and has remained below 5%, with the exception of October 2017, throughout 2017 and into 2018.
The ONS explained that the slowdown in UK house price growth over the past two years has been driven primarily by a slowdown in the South and East of England, while the lowest annual growth was experienced in London. In the capital, house prices have decreased by 0.7% over the course of the year, down from an increase of 0.3% in the year to June 2018.
In July, the average UK house price was £231,000, which is £6,000 higher than in July 2017 and £2,000 more than in June 2018. When looking at the figures on a seasonally adjusted basis, average house prices in the UK increased by 0.3% between June 2018 and July 2018, compared with an increase of 0.5% in average prices during the same period a year earlier.
Furthermore, on a regional basis, London continued to have the highest average house price at £485,000, followed by the South East and the East of England, which stood at £327,000 and £295,000 respectively. In contrast, the lowest average price continued to be in the North East at £132,000.
Commenting on the findings, PRIMIS and PTFS chief operating officer Toni Smith said: “The London property market has always been in its own bubble, bucking the trends of the rest of the UK. Whilst this won’t change overnight, we are increasingly seeing the pace of house price growth in other regions outstripping that of the City.
“This slower London market should help ease the affordability challenge faced by many buyers. Homes in most boroughs in the capital are now significantly cheaper in real terms than they were this time last year.”
However, Trussle CEO and founder Ishaan Malhi stated: “The slow house price growth in the market reflects the impact of financial uncertainty prompted by Brexit, high inflation and rising living costs.
“While slowing house price growth might be a relief for those hoping to get a foot on the ladder, it’s still a tough journey for many. A first-time buyer deposit costs just under two years’ of average earnings.
“There are some useful saving tools to help, such as government-backed Help to Buy ISA, which will boost your savings, but more needs to be done otherwise home ownership will remain unreachable for many. We need to ensure more transparency, convenience and certainty to make home ownership affordable and accessible for everyone.”
Subscribe to our newsletter to receive breaking news by email.