Monthly house prices have risen by 0.5% since July 2015, bringing the average property value in England and Wales to £184,682.
The data also shows that the number of property transactions has decreased over the last year. From March 2014 to June 2014 there was an average of 73,985 sales per month, dropping to 65,550 in the same months a year later. Additionally, the number of completed house sales in England & Wales decreased by 13% to 70,404 compared with 80,823 in June 2014.
The regional data indicates that the region with the most significant annual price increase is the East with a movement of 8.4%, while London experienced the greatest monthly rise with a movement of 1.7%.
The North West saw both the lowest annual price increase of 0.2% and the most significant monthly price decrease with a fall of 1.4%.
The number of properties sold in England and Wales for over £1 million decreased by 17% to 1,031 from 1,237 a year earlier.
Repossessions in England and Wales decreased by 43% to 498 compared with 868 in June 2014, with London seeing the greatest fall in the number of repossession sales.
John Eastgate, Sales and Marketing Director of OneSavings Bank, commented: “House prices are still rising, however it is encouraging to see some moderation in the rate of growth, with this being the slowest annual increase for two years, a statistic that will no doubt be well received by prospective buyers. With wage inflation now at a six year high, more moderate house price growth bodes well for the long-term health of the property market, and it should help reduce some upwards pressure on affordability.
We should, however, avoid focusing too much on the short term. This month’s figures might show that price growth has slowed, but the fundamentals are such that growth is inevitable over the long-term. Ultimately, the supply and demand imbalance will sustain property values. The UK is still desperately short of new housing, yet a combination of historically low mortgage rates and improving access to mortgage finance is sustaining demand.”
Jeremy Duncombe, Director, Legal & General Mortgage Club, added: “The lack of supply is continuing to drive a wedge between house price inflation and earnings growth. As a result, homes are becoming increasingly unaffordable, putting them out of reach for many aspiring homeowners. The longer this continues, the larger the housebuilding deficit will become, making the housing crisis progressively more difficult to resolve.
It’s crucial that the Government and the industry work together to remove any barriers that may be limiting construction. Housebuilders are faced with a shortage of skilled workers, materials to build with, and land to build on. It’s great to see that the Government has announced a target of 1 million new homes by the end of this parliament, but this is unlikely to come to fruition until these housebuilding constraints are addressed. Construction has been insufficient for a number of years, and we need a long-term solution to this problem, rather than just a short-term pledge.”
Adrian Gill, director of Your Move and Reeds Rains estate agents, comments: “It’s been a summer of rather more sedate house price growth, but the asymmetry between buyers and sellers on the market may usher in a new spell of conditions as we enter autumn. The market in London appears to have got the ball rolling again, as buyers get used to the heavier taxation, and prices in the capital and surrounding regions continue to travel at a must faster pace than up in the North West, North East, and Yorkshire.
But there’s no north-south divide in sentiment – and demand from buyers is shoring up on all fronts across the country. Sales activity may look slightly subdued on an annual basis, but property sales have actually been picking up speed solidly since the start of the year, and rose 4.4% between May and June. Most importantly, the gates are firmly propped open at the bottom of the market, and our own research shows this has been the strongest summer for first-time buyer sales since 2007. With an interest rate rise largely speculated to happen next year, the race will be on for many looking to move up the property ladder before borrowing becomes more expensive.”
