Annual UK house price growth slowed sharply in June, ONS data show |  house prices

Annual UK house price growth slowed sharply in June, ONS data show | house prices

The annual rate of growth in UK house prices has slowed sharply, falling from 12.8% to 7.8% in a month, according to official data indicating that the cost of living crisis is holding back the market. real estate.

The Office for National Statistics said the value of an average UK home rose by £3,000 in June, taking the typical price to £286,000. That’s £20,000 more than the year before.

While the annual rate of growth has slowed, said ONS statistician Ceri Lewis, “house prices continue to rise and average prices have now reached record levels in England, Wales and Scotland.”

At the same time, rents have continued to rise across the country, with a “sustained rebound” in London.

The latest ONS data, which runs through the end of June, follows figures from other sources through late July or early August that have indicated house prices are beginning to fall as interest rates rise and the broader cost-of-living crisis begins. to bite.

Earlier this month Halifax, one of Britain’s largest mortgage lenders, said house prices fell in July for the first time in more than a year, while property website Rightmove said on Monday that they had first dropped in 2022.

However, the ONS attributed the slowdown in the annual house price inflation rate to “the price increases observed in June 2021, which were the result of changes in tax reliefs”.

Sarah Coles, senior personal finance analyst at investment firm Hargreaves Lansdown, said last year’s stamp duty holiday had skewed the annual figure.

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“A large part of the fall [from 12.8% to 7.8%] This is because it is compared to last June, when price increases peaked. It was then that the most generous period of the stamp duty holiday was coming to an end, and people rushed to take advantage of it, vastly inflating prices.”

He added: “For a clearer picture, it is worth reviewing the figures on a month-by-month basis. These show that prices rose by an average of £3,000 between May and June.”

The ONS said that in England the median house price had risen 7.3% over the 12 months to £305,000. In Wales, the average figure rose 8.6% to £213,000. In Scotland, typical prices rose 11.6% to £192,000, while in Northern Ireland they rose 9.6% to £169,000.

Separate ONS data showed private rents paid by UK tenants typically rose 3.2% in the 12 months to July, versus 3% in the year to June. The ONS said this represented “the highest annual growth rate since this series began in January 2016”.

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