Residential property prices in England and Wales edged upward again in November with month on month growth of 0.1% in month, the latest index data shows.
The growth was driven by strong price gains in cheaper property with the average price now £295,276, according to the data from the LSL/Acadata house price index.
However, London is seeing the lowest rate of annual house price growth in the country. As recently as July this year, Greater London had the highest annual house price inflation of any UK region but in October it was the lowest, up just 0.1% over the year.
The index report says that this slowdown is the result of a significant drop in prices and transactions in prime central London property. Four out of five of the most expensive areas in London saw prices fall in the last month, led by Westminster where prices fell by 3.5%.
Year on year prices in Hammersmith and Fulham were down 13.2%, in Westminster they fell by 12.1% and in Camden were down 10.4% and the report adds that in the five highest priced boroughs in London average prices have dropped £112,950 over the year.
However, this has been offset by strong growth in value areas. In a mirror image of the top of the market, the five cheapest boroughs in London include the top three house price performers. In Bexley were are up 14.6%, in Barking and Dagenham up 14.4% and in Havering up 13.4%.
But the index report also shows that overall transactions remain subdued, down by 32% over the three months from August to October 2016, against the same period last year.
Elsewhere the East of England remains the best performing region, with average prices up 6.6% year on year, driven by strong increases in locations such as Thurrock with growth of 16.2%, Luton up 13.7% and Southend-on-Sea up 10.6%.
Average house prices are still up £8,792 on the same period last year. Transaction levels have followed a similar pattern, but have marginally improved in the last month. The estimated level of 77,500 sales in November is just a little below the recent average for the time of year.
While Rutland in the East Midlands recorded the highest annual growth month on month of 23.2%, the report suggests that this figure is largely the skewed result of relatively low sales volumes. Thurrock and Luton, in second and third place, have been consistent performers, with good rail links into London making them popular commuter hotspots for those priced out of the capital.
On the other side of London, the South East has also proved robust, with prices up 5.6% annually. Wokingham recorded a year on year price rise of 12.4%, Medway 10.5% and Brighton and Hove 9.6%. The South West also continues to perform well with prices up 4.5% annually.
At the other end of the market Yorkshire and Humber saw annual price growth of just 0.8%, Wales 1.3% and the North East 1.4%. But no region saw prices fall compared to a year ago.
The index report says that property has now recovered from the slowdown after the vote in June to leave the European Union with Brexit not having a major impact. Indeed, it explains that the most significant impact on the market this year remains the changes to stamp duty in April with the introduction of an additional 3% tax for buyers of additional homes.
Greater London is still the most expensive place to buy a home with an average price of £582,491, followed by the South East at £364,486, the East of England at £312,514, the South West at £268,162, the West Midlands at £205,854, the East Midlands at £197,276, the North West at £177,958, the Yorkshire and Humber at £177,652, Wales at £170,046, and then the North East at £154,431.
‘House price growth has slowed again, but in London, as elsewhere, there’s still appetite to continue driving up prices where buyers see value. For all the talk of Brexit uncertainty, the main factor driving up prices in the housing market is still supply and demand,’ said Adrian Gill, director of Your Move and Reeds Rains estate agents.
According to Richard Sexton, director of e.surv chartered surveyors, the market is still performing better than many expected. ‘Transaction levels remain subdued, but are not far off previous years. Prices are still edging up,’ he said.
‘Supply remains the big issue. The Chancellor has announced plans for 140,000 new homes as part of the Autumn Statement, but plans promised to boost supply will be in the housing white paper, postponed to January. The uncertainty that’s so characterised this year looks set to continue a while longer,’ he added.