UK house price growth in June fell to the lowest rate in five years, according to Nationwide’s monthly report.
Annual price growth slowed to 2 percent this month from 2.4 percent recorded in May according to the report. This marked the lowest rate of growth since June 2013, when UK prices rose by 1.9 percent.
The average price of a UK home stands at £215,444 according to the banking society, after rising by 0.5 percent on a monthly basis in June.
Robert Gardner, Nationwide’s chief economist, said the slowdown in the UK’s property market would continue over the course of the next few months.
“There are few signs of an imminent change. Surveyors continue to report subdued levels of new buyer inquiries, while the supply of properties on the market remains more of a trickle than a torrent.
“Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low.”
London remained the worst performing region in the UK, with house prices in the capital falling 1.9 percent in the second quarter of the year amid an increasingly subdued market.
Nevertheless, London remains the most expensive place to purchase a property, with an average price of £468,845 compared the nationwide average of £215,444.
This follows the release of a report by the Resolution Foundation Think Tank that said expensive property prices in the capital were pushing out people in their early 30s.
Stephen Clarke, senior economic analyst at the Resolution Foundation, said: “London has always played a key role in the UK economy. But that role has changed over the last decade and is often misunderstood.
“People assume London’s economy has been running away from the rest of the UK since the financial crisis. But London’s economic growth is purely down to its population explosion, with hospitality replacing banking as the big growth sector in the capital. Sectors that have traditionally powered London’s productivity growth, from finance to IT, are if anything going backwards.”
Earlier this week, the UK’s largest real estate agent, Countrywide, issued its second profit warning for the year, sending shares downwards.
Countrywide highlighted the slowdown of the property market in London, with official figures showing that prices in the capital are falling at the fastest rate since 2009.