House price growth picks up slightly

House price growth picks up slightly

House price growth picked up in September but continued the stagnation seen over the past few months.

According to the Office for National Statistics, average house prices in the UK increased by 3.5 per cent in the year to September 2018, an increase from 3.1 per cent in August.

But over the past two years there has been a slowdown in UK house price growth, driven mainly by a slowdown in the south and east of England.

Since June 2016, when annual house price growth was 8.2 per cent, the rate of growth has been on a downward trend and has been hovering between 4 per cent and 3 per cent since March.

The average UK house price was £233,000 in September 2018 - £8,000 more than a year previously.

House prices in England grew more slowly than other countries of the UK, increasing by 3 per cent in the year to September 2018.

In Wales and Scotland prices grew by 5.8 per cent while in Northern Ireland they went up by 4.8 per cent.

The lowest annual growth was in London, where prices fell by 0.3 per cent over the year, up from a fall of 0.6 per cent in the year to August 2018.

John Goodall, chief executive and co-founder of buy-to-let specialist Landbay, said: "Accelerating growth is being held back by falling property value in London, dragging down the rest of the country.

"Following years of steep price rises, affordability in the capital has become stretched. Combine this with the punitive changes to stamp duty and Brexit uncertainty, and it’s no wonder that would-be buyers and sellers are staying put."

The West Midlands saw some of the highest annual growth in the UK, with prices increasing by 6.1 per cent, followed by the East Midlands where growth was 6 per cent.

London was the only part of the UK to see house prices fall, driven mainly by the capital's inner boroughs where prices fell by 2.3 per cent while outer boroughs saw modest growth of 0.7 per cent.

Jeff Knight, marketing director for Foundation Home Loans, said: "Never-ending political uncertainty has clearly dragged on buyer confidence, with the property market at its weakest for six years.

"A limbo state is never a good sign but doesn’t mean everything comes to a complete stand still – regionally we are still seeing significant investment interest which confirms it’s not all doom and gloom."