House prices fell for the fifth successive month in August but continued to grow at an annual rate, according to Your Move.
The average house price for England and Wales in August was down 0.2 per cent month-on-month to £297,398, as five out of 10 regions witnessed declines.
But prices remained 2.1 per cent higher than the same period last year as growth in the regions contrasted with a sluggish London market.
Transactions rose by 6 per cent on a seasonally adjusted basis to reach 80,500 in August.
The east of England saw the strongest annual growth of 5.5 per cent as first-time buyers looked to secure affordable properties within commuting distance of the capital, Your Move said.
A 0.3 per cent monthly increase took the average price in the region to a new peak of £325,616.
Southend-on-Sea (up 11 per cent), Luton (up 9.2 per cent), Bedfordshire (up 9.1 per cent), Peterborough (up 8.6 per cent) and others saw strong gains, and no authority in the region has seen prices fall for eight months.
In London, however, year-on-year growth was a mere 0.7 per cent, with price drops in the more expensive boroughs contrasting with increases in more affordable areas.
Prices were down by 9.8 per cent in the City of Westminster, which is the second most expensive borough, while in Lewisham prices climbed by 6.7 per cent.
In contrast, Halifax’s August house price index painted a more positive picture of the housing market, showing prices were up by 1.1 per cent – the fastest rate of growth in eight months.
Oliver Blake, managing director of Your Move and Reeds Rains estate agents, said: “We’re seeing a balanced market this year.
"Regions like the east of England are closing the gap on the traditionally stronger performers like the south east as first time-buyers drive growth in search of more affordable housing.
“The rise in transactions in August and strong regional performance highlights a monthly slowdown of prices in the capital. However, on an annual basis, London’s boroughs, particularly those in the south east, are continuing to show steady growth.”
Jamie Lewis, director at Southend-on-Sea based Affinity Mortgages, said the town represents “amazing value for City workers”.
He said: “We have got some space in London, and the London-based clients who are migrating this way are selling one and two-bedroom flats and buying a four or five-bed detached this way for the same money. It is only a 40-minute commute to London.
“It is lots of people starting families, or who have had one child and are thinking of extending the family.
"If you are in a flat and looking to buy a house in London, the jump is so huge in that scenario the mother usually has to go back to work.
“If you look at the things that would appeal to a young family, Southend has a lot going for it – the seaside, good schools, good links and good value.”