House prices fell by 0.9% between August and September, following last month’s gain of 2.7%, the Halifax has reported.
It warned that monthly movements, however, can be volatile and the quarter on quarter change is a more reliable indicator of the underlying trend. House prices in the three months to September were 2.0% higher than in the previous quarter.
This measure of the underlying rate of house price fell from last months 3.0%, to its lowest since May. The annual rate eased from 9.0% to 8.6%.
The seasonally-adjusted average house price is now £202,859, the Halifax said.
Flat prices have risen the most. The Halifax cited separate research which has shown that there has been a 60% increase in the average price of a flat over the past 10 years; significantly higher than the 38% rise for all residential properties. Detached homes (21%) and bungalows (28%) have recorded the smallest rises over the last decade.
“Housing demand has been strengthening recently, underpinned by economic growth, rising real earnings and very low mortgage rates,’ explained Martin Ellis, Halifax housing economist.
“Increasing demand is combining with very low supply to drive robust underlying house price growth. There is little reason to expect any fundamental shift in the key market drivers over the coming months.”