House prices on the turn? Property values flat across the country and slip in London as buyers ebb away
- Hometrack reports 'momentum of house price rises has started to turn'
- Number of buyers registering with agents falls
By Camilla Canocchi for Thisismoney.co.uk
House prices stalled in September with typical UK property values flat over the month and London recording a slight fall, according to property data firm Hometrack.
The Hometrack survey of estate agent adds to mixed recent data on the housing market and is a possible indication that the market is turning.
Richard Donnell, Director of Research at Hometrack, said: 'There’s a distinct chill in the air this month: after a strong run over the last 18 months, the momentum of house price rises has started to turn with growth now at a standstill for the first time since January 2013.'
House prices: Supply of homes dropped faster than demand from buyers, causing prices to stall
According to Hometrack, properties in England and Wales showed zero price growth in September, while in the capital prices were 0.1 per cent lower than in August.
Behind the stagnant prices were falling numbers of new buyers. The number of buyers registering with Hometrack agents fell by 2.1 per cent, compared to a 1.6 per cent fall in August.
The supply of homes has also slowed down, falling by 0.3 per cent in September.
Supply and demand: Behind the stagnant prices were falling numbers of new buyers
The narrowing of the gap between supply and demand means that buyers achieved a lower proportion of their asking price in September, at 95.8 per cent, down 0.1 points from the previous month.
London was the only area to see house prices fall in September, although the proportion of districts to record falling house prices bounced back to 1.2 per cent from 4.2 per cent in July.
London and the South East also saw a decline in the proportion of the asking price being achieved.
Cooling off: London was the only area to see house prices fall in September
Prices grew marginally only in the North West, South East and Yorkshire and Humberside, where they were up by 0.1 per cent, while they stalled in all the other regions.
Some commuter belt areas have felt a ‘ripple effect’ from the strong house price growth which has previously been seen in London, Hometrack said.
Mr Donnell said that tougher mortgage affordability checks on the back of rule changes in April, speculation over possible interest rate rises and also the debate over Scottish independence may have added to feelings of consumer uncertainty recently.
He said: ‘Although the lead indicators suggest that buyers will start to gain the upper hand, there are many home owners who don't need to sell and won't bother unless it's financially beneficial to do so.
‘The net result is a likely drop-off in activity in the coming months.’
Despite the slowdown, house prices are still at a record high.
The latest data official data showed property prices reached a new record average of £272,000 in July after soaring by 11.7 per cent in the last year.
The ONS report found house values in London continued to rise faster in July than the rest of the country, with the capital seeing prices 19.1 per cent higher than the same point last year to hit £514,000.