Latest figures from the Nationwide show house price growth is at a two year low bringing average prices to £195,055.
According to Nationwide, the house price inflation fell to only 3.3% to June this year and from 4.6% in June a year ago.
House prices year on year have fallen in Wales by 0.8% and Scotland by 1.0% compared to an increase in Northern Ireland of 8.0% followed by London with a 7.3% rise.
Nationwide’s chief economist says that whilst the growth of house prices is still outpacing earnings, the gap between them is closing.
Wage growth narrowing the gap
This is being assisted by a spike in the annual wage growth, which rose to 2.7% from the start of the year to April, from 1.9%. These developments are also not confined to London, being across the entire country.
This could help first time buyers and home movers to purchase their new homes and remortgage buyers to secure better mortgage loans from lenders.
However, economists such as Howard Archer of IHS Global Insight and Matthew Pointon of Capital Economics have both said to not get excited over these statistics, since the house prices are still predicted to rise, thanks to rising demand and on an underlying basis.
Of course, some regions, even with their low house price growth, are still very much more expensive than the £195,055 national average as the following from Nationwide shows:
| Area | Value |
|---|---|
| London | £429,711 |
| Outer London | £315,620 |
| Outer South East | £244,119 |
| South West | £215,363 |
| East Anglia | £198,826 |
| West Midlands | £165,873 |
| East Midlands | £160,482 |
| Yorks and the Humber | £147,387 |
| North West | £146,908 |
| Wales | £144,701 |
| Scoltand | £140,512 |
| Northern Ireland | £126,525 |
| North | £125,189 |
The higher prices in London, the South East and South West still make it difficult for first time buyers and home movers to buy their homes.
Rise in house prices offers the older equity release mortgage buyer access to the wealth in their property using this to consolidate debt or help your children start or expand a business.
Large fluctuations within areas
Even inside the regions, there are variations and fluctuations, such as in Reading, which rose by 13%, Oxford by 12% and Edinburgh by 11%.
In comparison to their regions of the South East and Scotland which changed by 6% and -1% respectively.
Other locations also had variance in the opposite direction, with Sunderland being at -4%, Nottingham, Highlands and Islands and West Yorkshire all falling by 2%.
With the regions of the North East, East Midlands, Scotland and Yorkshire and the Humber changing by 1.4%, 4.1%, -1% and 3.3% respectively.
For home movers leaving areas with the highest rising property values to areas with lower growth, they may have extra equity for a deposit to buy a larger home or can reduce their mortgage.
What are your next steps?
Talk to our London City Mortgage advisers if you are an older homeowner releasing equity from your property, we can recommend the lifetime mortgage to access wealth for home or garden improvements and even buy a more expensive home.
Learn more by using the equity release calculator, property value tracker chart and mortgage cost mortgage calculator. Start with a free mortgage quote or call us and we can take your details.
At LCM our mortgage brokers can provide advice if you are a first time buyer, moving home, want to remortgage your existing home to a new cost effective mortgage deal or are a buy-to-let investor.
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