The Office for National Statistics (ONS) has reported that average house prices in the UK increased by 3.1% in the year to July 2018 (down slightly from 3.2% in June 2018).
This is the lowest UK annual rate since August 2013 when it was 3.0%.
The annual growth rate has slowed since mid-2016 and has remained under 5%, with the exception of October 2017, throughout 2017 and into 2018.
This slowdown in UK house price growth over the past two years is driven mainly by a slowdown in the south and east of England.
The lowest annual growth was in London, where prices decreased by 0.7% over the year, down from an increase of 0.3% in the year to June 2018.
Shaun Church, director at Private Finance, said: “Brexit uncertainty is the greatest test our housing market has faced since the 2008 financial crisis. The fact that property prices are still growing, albeit at a more modest rate, is a testament to the resilience of the UK property market. As gloomy predictions are made about the future of the housing market should we face a no-deal Brexit, UK homeowners should take solace in this persistent annual house price growth.
“House price performance remains incredibly varied across the UK. London is the only UK region experiencing falling prices, as buyers increasingly look to the commuter belt for more affordable properties. Meanwhile, house prices in other regions – particularly the North West – have seen annual growth of upwards of 4%. The imbalance between supply and demand continues to have a strong influence on regional affordability, and will continue to do so until the current housing shortage is addressed.”