House prices 'cooled in August'

London homes saw the smallest price rises

UK house price growth slowed in August, figures from the Office of the Deputy Prime Minister (ODPM) show.

Prices rose 1.2% in August compared with 1.8% in the same month last year, taking average prices up to £179,486 from £177,747 in July.

London, which tends to lead house price trends, saw the lowest increase while the North East saw the biggest.

The ODPM figures confirm trends from earlier surveys showing house price inflation is cooling.

The survey's figures, which are not seasonally adjusted, show the annual rate of house price inflation slipped to 13.6% in August from 14.3% a month earlier.

North leads way

London was the region with the lowest rate of inflation, which fell to 6.5% in August from 8.4% in July.

Elsewhere in the UK, the North East led the market upwards with an annual inflation rate of 25.6 pct, followed by Yorkshire and Humberside at 25.1%, and the North West at 22.7%.

Inflation rates in these regions remain substantially higher than in the rest of England, although rates in the East Midlands and West Midlands also remain high at above 17%, the ODPM said.

England continued to have the most expensive homes in the UK, with an average price of £191,97.

Wales was next, at £139,801, followed by Scotland with £114,619 and Northern Ireland, at £113,217.

Price increases during the period showed little variation by property type; detached properties added 1.5%, semi-detached rose 1%, terraced houses by 0.9% and flats by 1%.

Slowdown

The OPDM figures, which are based on sale completion prices, rather than mortgage approvals or asking prices, also showed first time buyers are having a tough time.

The number of first time buyers has almost halved - they made up an estimated 28% of buyers, rather than the usual 49%.

The survey appears to back Nationwide and Halifax data for August, which identified a slowdown in house price growth in the wake of five interest rate rises from the Bank of England since November last year.

The Nationwide's latest figures, for September, showed "subdued" growth continued with prices up just 0.2%.

However, Halifax found inflation had picked up in September, at 1.4%, reversing a fall in August.