Average house price growth slowing, official figures show

Official figures from the latest UK House Price Index show that average house prices fell by 0.6% between February and March.

The data for March also shows that annual house price growth slowed to 4.1%, down from 5.8% the previous month.

The official index calculates that the average UK house price in March was £215,847.

There is again less than promising news for the capital, with the figures showing that average prices dropped by 1.5% between February and March.

London's annual house price growth is now measured at 1.5%, well below the UK average. Despite this, average property prices in the city are still way out ahead at £471,742.

According to the index, prices in Wales have been performing strongly - rising by 1.4% between February and March, equating to annual growth of 4.3%.

The UK House Price Index replaced the Office for National Statistics and Land Registry indices last summer. It is published some way behind other reports like Rightmove's - which monitors asking prices - due to the fact that it takes into account actual sales.

“While it may look as though house price growth is beginning to slow down, affordability remains a key concern for many aspiring homeowners struggling to get a foot on the ladder,” says John Goodall, chief executive and co-founder of Landbay. 

“Furthermore, rising inflation and recent warnings from the Bank of England that a year of falling wages lies ahead means we’re unlikely to see any immediate relief.” 

Russell Quirk, chief executive and founder of eMoov, says the latest figures reflect a cooling in the market apparent in other indices.

“It is only natural that a fall in mortgage approvals translates to a drop in completions,” he explains. 

“Whilst a market slowdown may send an air of panic across the property sector the reality is that this stuttering pace of price growth is more of a natural adjustment, after the very high rate of inflation witnessed over the last few years.”

Jeremy Duncombe, director of Legal & General Mortgage Club, says: “With less than a month until the General Election, it is clear that housing needs to be a priority in all of the party’s manifestos.”

“The current government has made some admirable steps forward in tackling the serious shortage of affordable homes across the UK through the Housing White Paper, but there is still a long way to go.”