Property 

London and South East drag on house prices

London and South East drag on house prices

Average house prices increased by 0.9 per cent in the year to June 2019 and remained unchanged from May 2019, official data has shown.

According to the Office for National Statistics’ house price index, published today (August 14), the average UK house price was £230,000 in June 2019 — £2,000 higher than the same month a year ago.

There has been a general slowdown in UK house price growth - driven mainly by a slowdown in the South and East of England - but house prices in Wales increased by 4.6 per cent, with Scotland seeing 1.9 per cent growth and Northern Ireland growth of 3.5 per cent.

The lowest annual growth was in London, where prices fell by 2.7 per cent over the year to June 2019. According to the report, house prices in London have fallen on a yearly basis since March 2018.

But the capital still remains the most expensive place to buy a property, with an average price of £467,000. The South East also saw house prices fall - by 0.6 per cent year-on-year.

The strongest growth within England was in the East Midlands, where prices increased by 3.2 per cent. This was followed by the West Midlands, where prices increased by 2.6 per cent.

The North East was the cheapest place to buy property in England at £130,000 on average.

Dilpreet Bhagrath, mortgage expert at online mortgage broker Trussle, said: “With house prices unchanged from May 2019, the property market still remains stagnant. 

“And with a no-deal Brexit looming, this suggests that would be house-buyers are wary of committing to make the move.”

But Ms Bhagrath said for those that could afford to get on the housing ladder, many were thinking strategically and locking themselves into decade-long fixed rate mortgages.

Just today, FTAdviser reported that mortgage brokers predicted the market was likely to see more and lengthier long-term fixes as lenders aim to cash in on what they think will be a sustained period of low interest rates.

Sam Mitchell, chief executive of online estate agent Housesimple, thought a summer slowdown wasn’t surprising seeing as the market rarely saw big spikes in the warmer months, but added the threat of a no-deal Brexit could result in “considerable changes in the months ahead”.

Mark Harris, chief executive of mortgage broker SPF Private Clients, agreed the backdrop of Brexit uncertainty was affecting the market.

He added: “London is still creating a drag on average house price growth, with prices falling 2.7 per cent over the year to June. However, this was an improvement on the May fall of 3.1 per cent, suggesting price falls could be slowing and the market stabilising.”

Meanwhile Kevin Roberts, director at Legal & General Mortgage Club, said while house price growth in recent years had helped many existing homeowners build equity, for those looking to take their first steps onto the ladder, current prices had stretched affordability.

He added: “Fortunately, help is available. The Government’s Help-to-Buy scheme has supported thousands of first timers onto the ladder and innovation from mortgage lenders has offered new and existing homeowners a lot of different ways to find a mortgage.”