House prices in the United Kingdom are rising at the slowest pace in three and a half years as the bull run of double-digit price growth in areas such as London and the southeast comes to an end.
Only a year ago, London house prices were rising by almost 15% a year, and at their peak in 2000, prices were rising by 28.3% annually.
However, the growth in private rental prices has seen signs of a slowdown since the end of 2015, increasing by 1.8% in the 12 months to April 2017 and again the slowdown is mainly driven by a slowdown in London over the same period. In Scotland, the average price increased by 0.7% over the year to stand at £137,000.
The highest annual growth was found in the East of England and the East Midlands, up 6.7 per cent in the year to March 2017. This was followed by the West Midlands at 6.5%. The lowest rate of annual growth was seen in the North East, where prices fell by 0.4%.
On a regional basis, London continues to be the region with the highest average house price at £472,000. The lowest average price continues to be in the North East at £122,000.
Foundation Home Loans director of marketing Jeff Knight says: "With less than a month to go, attention is laser focused on the newest promises from the main political parties to tackle the continued lack of housing supply". Young, professional buyers in the capital will benefit from softer price rises, particularly as wage growth is expected to pick up.
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"Low mortgage rates and lack of supply continue to underpin United Kingdom house price growth but many buyers, especially first-timers in London and the south, continue to feel the strain of making their stagnating salaries stretch to match the continually increasing cost of housing".
The figures add to the mounting collection of data which points to the housing market becoming increasingly affected by the growing squeeze on consumers.
Matt Robinson, chief executive of Nested, said: "Many people may be fooled into thinking that today's data shows a housing market suffering from the effects of uncertainty, but I believe that the stable levels of growth are far more conducive to activity".
London house prices fell faster than anywhere else in the country in March as the impact of Brexit finally caught up with the property market. "The month-on-month decline is yet another indication the market is beginning to stagnate, which supports other recent evidence of lower market activity, such as fewer new buyer enquiries with estate agents". This highlights a change in the United Kingdom property market.
"Across the rest of the United Kingdom, house price growth looks set to remain dampened by sluggish growth in wages".
Sommerville commented: "It is encouraging to see that the issue of housing has come to the fore in this year's election campaign with the Conservatives promising a "new generation" of social housing and Labour pledging to build one million new homes".