House prices growing at slowest rate for more than a year

Slowdown described as temporary but not entirely unexpected

UK house prices rose by 0.1 per cent in July, according to Nationwide, representing the slowest growth since April 2013.

Its figures show that annual house price growth has slowed to 10.6 per cent from 11.8 per cent in June. This makes the average price of a house £188,949, although price indices vary considerably because of different ways of assessing them. Earlier this month LSL Property Services put the average house price at £268,637.

Robert Gardner, Nationwide's Chief Economist, said that the slowdown was probably temporary but 'not entirely unexpected' following evidence of a moderation in prices over the last few months.

"Mortgage approvals declined by almost 20 per cent between January and May," he said. "At least part of the slowdown in activity relates to the introduction of Mortgage Market Review measures. The modest rebound in mortgage approvals in June adds weight to the notion that the slowdown will prove temporary, though the underlying pace of demand remains unclear."

However, Hugo Thistlethwayte, managing director of buying agency Prime Purchase said: "What Nationwide says probably only applies to about 10 per cent of the UK property market because of the limited use of an average house-price figure.

"This slowdown doesn't apply to certain markets. Cambridge and Oxford are booming and there are no signs of the property markets slowing there. In areas such as West London, the housing market may be more muted than it has been but we are still seeing price rises on top of price rises. The market is as near equilibrium now as it can be."

"Over the longer term, the trajectory of house prices will remain crucially dependant on supply side developments. While there have been some encouraging signs that construction activity is picking up, the pace of home building continues to run far below most estimates of what would be required to keep up with household formation in the years ahead," said Gardner.

Paul Smith, CEO of haart, said: "House prices are not falling off a cliff, these latest figures show they are currently having a welcomed ‘pit-stop’ which is necessary for long-term, sustained growth. Annual growth figures are always a far more reliable indicator of long term trends.

"Some areas of the capital are undergoing a price correction whereby people are not willing to pay the prices as they stand, but the laws of supply and demand are still in place and we are seeing steady house price growth in the country as a whole. All elements are pointing to a very busy autumn for the market."

The Nationwide report also shows that stamp duty revenue has increased considerably in the last year to over £10 billion due to the rise in the number of housing transactions and rises in house prices.

Ed Goodworth, real estate partner at accountancy and business advisory firm BDO, said: "There is no doubt that the Mortgage Market Review is acting as a brake on house prices, but while our clients are reporting reduced footfall for new builds, there is still an excess of demand over supply.  This significant supply shortage means there is less likelihood of a full scale correction in the housing market, particularly in London and the South East, and unless the government acts to help stimulate housebuilding in the UK, buyers will continue to be priced out of the market."

Read more: Homeowners say getting a mortgage is becoming harder
Waterfront properties worth 60 per cent more than similar homes inland
House prices show no monthly change  
Discover more property articles at Homes and Property
PROMOTED VIDEO
Sport
Scunthorpe goalkeeper Sam Slocombe (left) is congratulated by winning penalty taker Miguel Llera (right)
football
Life and Style
A woman walks by a pandal art installation entitled 'Mars Mission' with the figure of an astronaut during the Durga Puja festival in Calcutta, India
techHow we’ll investigate the existence of, and maybe move in with, our alien neighbours
Arts and Entertainment
Sir Ian McKellen tempts the Cookie Monster
tvSir Ian McKellen joins the Cookie Monster for a lesson on temptation
News
i100
Travel
Tourists bask in the sun beneath the skyscrapers of Dubai
travelBritish embassy uses social media campaign to issue travel advice for festive holiday-makers in UAE
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Direct Sales Consultants - OTE £65,000 - £100,000

£65000 - £100000 per annum: Recruitment Genius: This national direct sales com...

Recruitment Genius: Telesales Consultant - OTE £40,000

£20000 - £40000 per annum: Recruitment Genius: Can you sell? Want to earn over...

Recruitment Genius: Partitioners / Carpenter / Multi Skilled Tradesmen / Decorator

£28000 - £50000 per annum: Recruitment Genius: Various opportunities are avail...

Recruitment Genius: Trade Marketing Manager

£25000 - £30000 per annum: Recruitment Genius: This company leads the market i...

Day In a Page

Jeb Bush vs Hillary Clinton: The power dynamics of the two first families

Jeb Bush vs Hillary Clinton

Karen Tumulty explores the power dynamics of the two first families
Stockholm is rivalling Silicon Valley with a hotbed of technology start-ups

Stockholm is rivalling Silicon Valley

The Swedish capital is home to two of the most popular video games in the world, as well as thousands of technology start-ups worth hundreds of millions of pounds – and it's all happened since 2009
Did Japanese workers really get their symbols mixed up and display Santa on a crucifix?

Crucified Santa: Urban myth refuses to die

The story goes that Japanese store workers created a life-size effigy of a smiling "Father Kurisumasu" attached to a facsimile of Our Lord's final instrument of torture
Jennifer Saunders and Kate Moss join David Walliams on set for TV adaptation of The Boy in the Dress

The Boy in the Dress: On set with the stars

Walliams' story about a boy who goes to school in a dress will be shown this Christmas
La Famille Bélier is being touted as this year's Amelie - so why are many in the deaf community outraged by it?

Deaf community outraged by La Famille Bélier

The new film tells the story of a deaf-mute farming family and is being touted as this year's Amelie
10 best high-end laptops

10 best high-end laptops

From lightweight and zippy devices to gaming beasts, we test the latest in top-spec portable computers
Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

Michael Carberry: ‘After such a tough time, I’m not sure I will stay in the game’

The batsman has grown disillusioned after England’s Ashes debacle and allegations linking him to the Pietersen affair
Susie Wolff: A driving force in battle for equality behind the wheel

Susie Wolff: A driving force in battle for equality behind the wheel

The Williams driver has had plenty of doubters, but hopes she will be judged by her ability in the cockpit
Adam Gemili interview: 'No abs Adam' plans to muscle in on Usain Bolt's turf

'No abs Adam' plans to muscle in on Usain Bolt's turf

After a year touched by tragedy, Adam Gemili wants to become the sixth Briton to run a sub-10sec 100m
Calls for a military mental health 'quality mark'

Homeless Veterans campaign

Expert calls for military mental health 'quality mark'
Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

Meet Racton Man

Analysis shows famous skeleton was a 6ft Bronze Age superman
Garden Bridge: St Paul’s adds to £175m project’s troubled waters

Garden Bridge

St Paul’s adds to £175m project’s troubled waters
Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

Stuff your own Christmas mouse ornament

An evening class in taxidermy with a festive feel
Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

Joint Enterprise

The legal doctrine which critics say has caused hundreds of miscarriages of justice
Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

Freud and Eros

Love, Lust and Longing at the Freud Museum