Average house price growth has fallen for the first time since March 2012, reducing by -1.3% in August, e.surv has found.

The latest e.surv Acadata house price index, which monitors house price growth in England and Wales, indicated that the average house price is currently £369,127, falling by -0.2% month-on-month.

Furthermore, the annual growth in house prices has dropped by -1.8% when London and the South East are excluded from the results.

The reduction in growth correlates to a month-by-month decline, having fallen from 1.6% in May, and a 0.2% increase in July.

However, this annual decline follows a 12.7% increase in house prices in August 2022, when the housing market experienced buoyant demand following the COVID pandemic and a period of low interest rates.

The South West of England saw the furthest decrease in annual house prices, dropping by -1.6% in the past 12 months. The current average house price in the region stands at £366,971.

However, the East Midlands saw the most notable increase, rising by 1.9% between August 2022 and August 2023. The average house price is currently £279,589.

Director at e.surv, Richard Sexton, said: “August has traditionally been a quieter time in the housing market but this has been compounded by the cost of living crisis and associated affordability challenges for buyers. Our data shows that house prices have fallen by some £755, or -0.2%, in the month of August, the third largest monthly fall of 2023. Prices have now dropped in each month since November 2022 and on an annual basis, the average sale price of completed home transactions using cash or mortgages in England and Wales fell by some £4,800, or -1.3% in August 2023, and now stands at £369,127.

“But the story is not uniform across the UK. Buyers’ expectations are evolving in many cases as they begin to look at different areas and different property types. In other markets, cash buyers, who account for a third of transactions, remain particularly active in highly priced areas.

“For borrowers, the recent comments by governor of the Bank of England, Andrew Bailey, may prove to give some respite from rising loan costs in due course, and we should keep some perspective on current price falls. The fall in the average price of £9,300 since its peak in October 2022 must be viewed against the cumulative £54,000, or 17%, rise in prices since the start of the pandemic in March 2020. By that measure houses remain a very good investment.”

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