But growth still marginally up from start of the year
Property prices in August have experienced the first year-on-year decrease since November 2023 after falling 0.4%, according to Lloyds’ latest house price index.
The average cost of a house was also slightly down (-0.2%) from the previous month, following a 0.1% decrease in July. This brought the average property price in August to £298,468 compared with £299,153 in July.
Andrew Asaam, mortgages director at the bank, attributed the housing market slowdown in recent months to the “impact of global events on inflation and borrowing costs creating greater economic uncertainty.”
“More [homeowners] are choosing to sit tight, with sellers reluctant to accept offers they feel are too low, while some buyers are waiting to see how conditions develop,” he said, adding that mortgage approvals are now at their lowest level since the start of 2024.
However, house prices in August were still “around 25% higher” than at the end of 2019 and up 0.2% since the start of the year.
Northern Ireland continued to record the UK’s strongest annual growth at +6.9% with the average property price at an all-time high of £231,245.
Meanwhile, Scotland saw prices rise 3.5% over the past year to £231,245 and Wales’ annual growth stood at 0.6%, taking the typical property value to £230,282.
The north east and north west of England saw growth of 2.7% and 2% respectively, while the South East recorded the largest annual decline (-1.6%).
Prices fell 1.5% in Greater London and 1.2% in the south west and east of England.
Asaam said: “We expect the market to remain fairly subdued in the months ahead, but this will likely only have a limited impact on house prices. While affordability remains a challenge, wages continue to grow and employment has held up better than many anticipated. This will help to support demand from those who need or want to move.”
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