London house price grows to the same rate as inflation

House cost growth in London has eased back to an equal rate of inflation, as indicated by Hometrack.

Its list of house prices over UK cities found that the capital’s yearly rate of growth is presently 2.6 percent, achieving a five-year low in June.

Richard Donnell, head of research at Hometrack, stated: “In London, the Brexit vote has had a greater impact on buyer sentiment and combined with affordability issues has led to a 10pc reduction in the annual growth rate over the last 12 months.

“However, although house price inflation has fallen sharply in the capital it is starting to flatten out, and the rate of growth is likely to avoid year-on-year price falls in the coming months.”

Mr Donnell raised his expectations of house price growth in urban areas over 2017 from 4 percent, made last December, to 6-7 percent.

Thirteen cities over the UK have a lower yearly growth rate than a year back, with four – Oxford, Cambridge, Newcastle and Aberdeen – having levels below the rate of inflation, bringing about negative real house price increase. The standard rate of increase over UK urban communities was 5.1 percent every year, down from 8.8 percent in June 2016.

This abating of the market has been pulled down to a great extent by cities in the south of England; Birmingham maintained to record the biggest amount of yearly value growth at 7.8 percent, with Manchester and Leeds likewise indicating robust growth.