Annual UK house price growth slowed to 8.0% in July, according to the latest Office for National Statistics (ONS) House Price Index.
This figure was a drop from the 13.1% annual growth that was recorded in June.
On a non-seasonally adjusted basis, average house prices in the UK decreased by 3.7% between June and July, which compared to an increase of 0.8% during the same period in 2020.
The figures mean the average UK house price sat at £256,000 in July, a figure £19,000 higher than this time last year, following the record high of £265,000 June 2021.
The ONS figures showed that average house prices increased over the year in England to £271,000 (7%), in Wales to £188,000 (11.6%), in Scotland to £177,000 (14.6%) and in Northern Ireland to £153,000 (9.0%).
Commenting on the data, Market Financial Solutions CEO, Paresh Raja, said: “We were always likely to see a slowing in the rate of house price growth in July.
“Given the first stamp duty holiday deadline was at the end of that month, many prospective homebuyers will have resigned themselves to the fact that they would not be able to complete a purchase in time and, as a result, miss out on the potential savings of £15,000. Demand will have eased off and prices will have stabilised a little.”
Perenna COO and co-founder, Colin Bell, added that the ONS figures would bring into focus how difficult future generations may find it to buy a home.
“House price growth has reached double figures several times already this year and it’s clear to see that something needs to change if younger people are ever going to be able to step onto the property ladder and homebuyers be able to trade up as their needs change,” Bell said.
“Long-term fixed rate mortgages provide the best solution to solving the affordability issues faced by homebuyers because they allow people to borrow more, while also providing complete protection from future interest rate increases.
“This helps to keep deposit requirements to a minimum, does away with the stress testing required to ensure borrowers can afford the mortgage if interest rates rise and also means borrowers don’t have to remortgage unless they have found a better rate not when their short term fixed rate ends.”
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