Average UK house prices slowed to a 1.7% rise to £288,000 in the year to June, data from the Office for National Statistics shows.
This figure is down from a 1.8% increase in May. This makes the average UK home £5,000 more expensive than 12 months ago, but is £5,000 lower than the recent peak last November.
The North East saw the highest annual percentage change of all English regions in the 12 months to June, up 4.7% to £161,000, while London saw the lowest, a 0.6% fall to £528,000, which sees the capital remain as the most expensive region in the country.
SPF Private Clients chief executive Mark Harris says: “Swap rates, which underpin the pricing of fixed-rate mortgages, have been much calmer in recent weeks after a period of extreme volatility, giving lenders the confidence to start reducing their mortgage rates.
“The markets reacted broadly favourably to the latest inflation data this morning, with five-year Swaps falling to 5.01% from 5.07% yesterday. If Swaps continue to move in this direction, other lenders may well reduce their mortgage rates, which will be welcome news for hard-pressed borrowers.
Harris adds: “While base rate is expected to peak at around 5.75% to 6%with another rate rise next month, there is a strong argument for the Bank of England to then pause rate rises to let the dust settle.
“Consecutive base rate rises have been painful — it’s time to let them take effect, rather than causing continued anxiety and distress for borrowers.”
MPowered Mortgages managing director of mortgages Emma Hollingworth points out: “Despite the slight decline in today’s figures, the housing market is showing renewed signs of resilience.
“With mortgage rates having fallen in recent weeks, and private sector pay growing at record levels, a dramatic fall in house prices is looking more and more unlikely.
“We can also expect inflation to fall further, allowing first-time buyers to increase the amount of money they can affordably borrow.
“Typically, August can be a slow period for the housing market, and affordability will remain a barrier for many would-be homeowners in the coming months, but given more lenders are continuing to reduce rates we can expect a strong finish to the year.”
MT Finance director of property Tomer Aboody adds: “Fewer transactions due to lack of confidence in recent months is reflective of the market and sentiment, with buyers and sellers sitting on their hands as they await some stability.
“Although transaction numbers might be rising, they’re still half of what they were this time last year.
“With inflation heading in the right direction, helping the government’s commitment to halve it by the end of the year, confidence should improve. Hopefully, an end to interest rate rises is also in sight, which will give borrowers a much-needed boost.”
