The Nationwide Building Society has reported that annual house price growth eased back to 10.0% in September, from 11.0% in August.
Nationwide said that prices rose by just 0.1% during the month.
Robert Gardner, Nationwide’s chief economist, said: “Annual house price growth remained in double digits for the fifth month in a row in September, though there was a modest slowdown to 10.0%, from 11.0% in August. House prices rose by 0.1% month-on-month, after taking account of seasonal effects. As a result, house prices remain c13% higher than before the pandemic began in early 2020.
“Our regional house price data is produced quarterly and showed a mixed picture across the country in Q3 (the three months to September). While price growth accelerated in Wales, Northern Ireland and Scotland, most English regions recorded a slowdown.
“Wales was the strongest performing region with house prices up 15.3% year-on-year – the highest rate of growth since 2004. Price growth remained elevated in Northern Ireland at 14.3%. House price growth in Scotland picked up to 11.6% in Q3, in contrast to the previous quarter when it was the weakest performing part of the UK (at 7.1%).
“England saw a slowing in annual house price growth to 8.5%, from 9.9% in Q2. Price growth in northern England (North, North West, Yorkshire & Humberside, East Midlands and West Midlands) continued to exceed that in southern England (London, Outer Metropolitan, Outer South East, East Anglia and South West).
“Yorkshire & Humberside was the strongest performing English region for the second quarter in a row, with prices up 12.3% year-on-year, followed by the North West, which saw an 11.4% rise.
“London was the weakest performer, with annual growth slowing to 4.2% from 7.3% last quarter. The surrounding Outer Metropolitan region, which includes places such as Luton, Watford, Sevenoaks and Woking, also saw a softening to 6.8%, down from 8.2% in Q2.
“House prices have continued to rise more quickly than earnings in recent quarters, which means affordability is becoming more stretched. Raising a deposit remains the main barrier for most prospective first-time buyers. A 20% deposit on a typical first-time buyer home is now around 113% of gross income – a record high.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, added: “An ambition to take advantage of the maximum stamp duty concession prompted many to bring forward home buying decisions so prices are not rising as rapidly now. However, these figures also confirm what we are seeing on the ground, that there is still plenty of life left in the market – in fact, many prefer buying and selling in a less frenzied atmosphere – underpinned by a continuing shortage of stock, particularly of three and four-bedroom family houses.
“Looking forward, we don’t expect to see major changes although the increase in supply is helping to moderate prices further and bring more balance to the market.”