‘Cool down’ in housing market

Sellers in England and Wales typically achieved 95.9 per cent of their asking price in August, falling back for the third month in a row from 96.8 per cent in May, according to Hometrack.

House prices increased by 0.1 per cent month-on-month for the second month in a row in August and the report said that weakening demand from buyers and an increasing supply of properties for sale means that homes are lingering on the market for longer and sellers are having to accept bigger discounts.

In the Yorkshire and Humber region, property prices rose by 0.1 per cent month-on-month in August, alongside the South-West, the East Midlands and the West Midlands. In London they were unchanged and in the South-East they increased by 0.2 per cent.

The director of research at Hometrack, Richard Donnell, said: “The latest survey continues to point to clear evidence of slowdown, particularly in the London market. This is not a huge surprise for August but the signs of a slowdown in market activity were starting to emerge back in May, with evidence of growing resistance to rapid price rises in the London market.

“Important lead indicators in this survey are turning and pointing to a loss of momentum in house price growth, in particular a widening gap between asking and achieved prices in the face of weaker demand and an increase in the time on the market. Both indicators are coming off a positive base which suggest a slowdown in the rate of growth rather than price falls.”

The average property value for the Yorkshire and Humber region was yesterday £157,445 compared to £155,892 one month ago, according to Zoopla.

The National Housing Federation director of policy and external affairs, Gill Payne, said: “Although house price growth is slowing down, house prices are still out of reach for many. A generation-long failure to build enough homes has made prices soar far in excess of inflation and the UK remains vastly short of the housing that its growing population needs. The only way to end the housing crisis within a generation is to build more homes.”

Hometrack also found that house price growth in London is continuing to under-perform the rest of the country as buyers become more “price resistant”, following the strong increases in values seen in the capital in the first half of the year. The strongest month-on-month growth was seen in Wales, where prices recorded a 0.5 per cent increase.