The latest Halifax House Price Index for July shows that house prices increased by 0.7%, the fourth consecutive month that house prices have grown by less than 1.0%, confirming that house price inflation is slowing. Between April and July house prices increased by 1.3%, which is the smallest monthly rise since August 2006. The standardised UK average house price (seasonally adjusted) is now £198,915.
Halifax also reports that mortgage approvals to fund house purchase in 2007 Q2 were 8% lower than in 2006 Q4 and the level of new buyer interest in purchasing a house fell for the seventh successive month in June.
Commenting, Martin Ellis, Halifax chief economist, said: "House prices increased by 0.7% in July. This is the fourth consecutive month that house prices have risen by less than 1.0%, confirming that house price inflation is slowing. We expect the downward trend in house price growth to continue as the five interest rate rises since last summer have an increasing impact on household spending and housing demand. Sound economic fundamentals, high levels of employment and a shortage in the number of properties available for sale, particularly in London and the South East, will, however, continue to support house prices."
