UK House Prices:pace of growth in the East and South-East outstrips the capital - but prices are still rising

Slowing house price growth in the capital means that London no longer tops the tables as the UK region with the fastest rising house prices...

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New figures reveal the average cost of buying a home in London has risen by 12.1 per cent - or £53,000 - to £489,000 over the past year.

This equates to more than double the UK average, which now stands at £219,000 after rises of 8.4 per cent in 12 months, according to the latest house price data from the ONS.

The figures represent the 19th consecutive month of house prices increases across the UK, with the last monthly price drop recorded almost two years ago in January 2015.

However, following April's stamp duty changes and June's Brexit vote, house price growth is showing signs of slowing month-on-month.

“We project that average UK house price growth for 2016 will be over five per cent, but will cool to around one per cent in 2017 in response to slower expected economic growth next year," says economist at PwC, Thomas Fisher.

House prices in the East of England, which takes in areas from Hertfordshire to Norfolk, have risen by 13.3 per cent to £277,000 over the past 12 months, making it the fastest-rising region.

This is closely followed by the South East, stretching from Berkshire to the Isle of Wight, where annual growth of 12.2 per cent has seen house prices rise on average to £318,000.

Meanwhile, in Greater London, growth of 12.1 per cent puts the capital in third place.

"This comes as buy-to-let landlords and overseas buyers continue to venture out of the capital and into regions where they are now more likely to see more lucrative returns on their investment," says Paul Smith, CEO of haart estate agents.

"However, the continued lack of supply will always hold the market up in the resilient capital, and this is unlikely to see a too damaging effect on growth," he predicts.

Every other region has recorded single-digit growth over the last year.

Prices in the South-West have grown by nine per cent to £243,000, Northern Ireland by 7.8 per cent to £123,000, the East and West Midlands by an average of 7.3 per cent to £178,000, and the North West by 6.3 per cent to £151,000.

Wales continues to see modest growth, with prices increasing by 2.7 per cent in a year to £145,000.

A similar story plays out in the North East with prices rising by three per cent to £127,000, and in Scotland prices have risen by 4.3 per cent to £145,000.

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