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London falls behind as UK house prices rise 5.1%
The official seasonally adjusted house price index rose by 0.3% month-to-month in November, according to the November edition of the UK House Price Index published by the Office of National Statistics on Tuesday.
The estimated price level for October was also revised up by 0.9%, and as a result, year-on-year price growth hit 5.1%, beating the general consensus of 4.2% and meaning that although the annual growth rate had slowed since the halfway point of the previous year, it had remained broadly around the 5% mark throughout the year.
Overall, prices in England saw growth of 5.3% over the year to November, with the average price hitting around £243,000 across the country, with Wales posting a 4.5% increase and Scotland and Northern Ireland reporting gains of 3.6% and 6%, respectively.
The West Midlands witnessed the highest annual rate of growth of any region in the UK as house prices moved ahead 7.2%, followed by the East Midlands at 6.4% and the North West and South West at 6.2%.
The lowest annual rates of growth were recorded in London and the North East, at just 2.3% year-on-year. Yorkshire and the Humber were close behind on 3%.
Samuel Tombs, Pantheon Macroeconomics' chief UK economist, said that while it was still too soon to assess the impact of November's interest rate rise on house prices, "Timelier indicators published by the Royal Institute of Chartered Surveyors, Rightmove and the National Association of Estate Agents all suggest that growth in house prices is slowing.
"At a regional level, prices in London have continued to underperform, falling by 0.4% month-to-month and rising by just 2.3% year-over-year in November. This weakness remains more pronounced in central London boroughs, due to overdevelopment of high-end flats and Brexit-depressed overseas demand. Across most other regions, house price growth was only slightly weaker in 2017 than in 2016, but we expect a more pronounced slowdown this year as higher rates will restrict the amount that households can borrow," he added.