Is The Housing Boom Over?
House prices rose by just 0.1 per cent in September prompting speculation that the upward spiral of property values may be coming to an end.
Although still rising, the percentage is the smallest increase in the past 15 months with the average home now costing £188,949, according to figures released by Nationwide.
Prices have risen by 10.6 per cent since this time last year, adding an average of £20,000 to the value of a UK home.
But stricter rules on mortgage lending - which came into force in April - helped cool the market in July as prospective homeowners now have to undergo a thorough vetting to ensure they can afford the repayments.
Nationwide said the small rise in house prices was not unsurprising and a lack of supply could mean the slowdown is temporary.
The Nationwide figures complement those released earlier in the week by the Land Registry, who found that the typical selling price of a property across England and Wales had remained exactly the same, indicating a fall in real terms, due to inflation.
A lack of new homes, especially in London and the South East has helped put an upward pressure on house prices over the last few years. A typical home in London now costs twice the UK average.
A shortage of decent family homes has seen the fastest selling times on record in nine regions across Britain. The typical home now spends just 88 days on the market – 16 days faster than this time last year. Properties in London sell in an average of 43 days.
Higher house prices have helped push stamp duty revenues close to an all-time high, Nationwide said.
According to the report by the group, the widening gap in house prices between London and the rest of the UK is causing a huge imbalance in the amount of stamp-duty buyers are paying.