Average UK house prices increased by 10.2 per cent in the year to June, down from 10.4 per cent in the year to May, the Office of National Statistics (ONS) says.
This follows the moderate house price increases the UK has experienced since April 2012, and is driven in large part by increases in London.
The average UK mix-adjusted house price in June 2014 was £265,000, ONS says.
According to the index annual house price inflation was 10.7 per cent in England, 3.5 per cent in Wales, 6 per cent in Scotland and 4.9 per cent in Northern Ireland.
Prices in London again show the highest growth although prices increased strongly across most parts of the UK for June.
England is the only UK country where property prices are now higher than the pre-financial crisis peak of January 2008.
England’s price growth was driven by an annual increase in London of 19.3 per cent and to a lesser extent increases in the South East (9.7 per cent) and the East (7.9 per cent).
When London and the South East were excluded, UK house prices increased by 6.3 per cent in the 12 months to June.
Brian Murphy, head of lending at Mortgage Advice Bureau, says tighter lending regulations and the summer slowdown are helping cool the housing market.
“Nevertheless, the slowing of growth between May and June has been modest at best,” he says.
“The latest ONS figures suggest we have passed the point of seeing a higher rate of increase every month – temporarily at least – but demand for homeownership remains strong and will help to uphold prices for the foreseeable future.”
A drive for new housebuilding and continued help for first-time buyers remain crucial if current affordability issues are to be kept in check, Murphy warns.
