House price slowdown continuing

House prices rose by just 0.3 per cent in September as the market continued the softening trend seen over the summer, the Department of Communities and Local Government (DCLG) has reported.

The latest DCLG house price index has found that the average price of a home is now £220,111, up from a figure of £219, 369 reported for August. Month-on-month price growth, however, was down from 0.5 per cent.

Annual price inflation in both London and the UK as a whole fell over the month, down from 17.2 per cent to 16.5 per cent and from 11.3 per cent to 10.8 per cent respectively.

"Although today's numbers show annual house price growth remaining in double digits, the slowdown in the UK housing market can clearly be seen," said David Stubbs, senior economist at the Royal Institution of Chartered Surveyors.

"With interest rates at 5.75 per cent and the impact of the credit crunch reducing mortgage lending options from many would-be buyers, the slowdown in both activity and price growth is unsurprising," Mr Stubbs added.

Last month a separate government department, the Land Registry, reported that prices rose by 0.4 per cent in September.

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