The growth rate for homes has slowed to 5.8% a year the slowest rate since August 2013 according to the Halifax house price index.

Latest data from the Halifax house price index shows the value of property increased 5.8% over the year to September and this has slowdown from the 6.9% recorded in August.

The average property value is £214,024 although the rate of growth is lower than the high reached of 10.0% over the year to March.

Data published by the Nationwide also shows a slowdown with annual house price growth at 5.3% in September down from 5.6% in August.

The house price index from the Nationwide also showed annual house price growth slowed during September although their average house price is slightly lower than the Halifax at £206,015.

House prices slightly lower

The latest figures show average house prices have reduced by £2,702 since reaching a high of £216,726 in June 2016.

A slowdown in house prices was predicted from the Brexit vote to leave the EU and could benefit first time buyers trying to get on the property value giving them more time to save for a deposit.

Help for first time buyers can come from their family as the equity release mortgage buyer can access wealth to gift a child or grandchild the deposit on their first home.

Martin Ellis, Halifax housing economist said the housing market has followed a steady downward trend over the past six months with clear evidence of both a softening in activity levels and an easing in house price inflation.

There has been a lengthy period where house prices have risen more rapidly than earnings has put pressure on affordability constraining demand said Mr Ellis.

The current very low mortgage rates and a shortage of properties available for sale on the market should, however, help support price levels over the coming months

For remortgage buyers the strong growth over the last few years still gives them an opportunity to release capital at a low mortgage cost which they can use to improve their home, further increasing the property value.

Regional prices remain unchanged

Robert Gardner, Chief Economist at the Nationwide said regional price trends were little unchanged and the south east of England continued to record the strongest gains.

The Outer Metropolitan region has seen a noticeable slowdown in price growth reducing from 12.4% a year in quarter two to 9.6% per year in quarter three with average property value now at £358,153.

London also saw a moderation in the rate of house price growth from 9.9% a year in quarter two to 7.1% a year in quarter three with average property value now at £474,736.

Even though house prices are slowing, there is demand whether from first time buyers, home movers or buy-to-let landlords helping housebuilders to increase new build homes.

There was an increase in new build homes for the year to quarter two 2016 with 139,000 constructed and this was 30% higher than the low point reached in 2010, although 38% below the 225,000 new homes built each year before the financial crisis.

With interest rates expected to remain low and support for homeowners with smaller deposits from the Help to Buy scheme and shared ownership, builders should be able to maintain capacity at current levels for the next five years.

What are your next steps?

Talk to our London City Mortgage brokers for advice if you remortgage your existing home and want the best mortgage deal or release capital, buying your first home, moving home or are a buy-to-let investor.

For older homeowners releasing equity from your property, our LCM mortgage advisers can recommend the lifetime mortgage, accessing wealth to maintain your lifestyle or reduce inheritance tax owed by your beneficiaries.

Learn more by using the equity release calculator, mortgage cost calculators, and property value tracker chart. Start with a free mortgage quote or call us and we can take your details.

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