The latest index figures from Hometrack suggest that property price growth in key UK cities is continuing to rise.
According to the report, values increased by 3.5% in the last three months-the largest quarterly rise since June 2014. In addition, the average year-on-year price was up by 5.1%, slightly down on the 5.2% seen one month earlier.
This saw the average property price in the 20 cities covered by the index to £250,200. However, there is some regional variation, with some areas seeing a significant slowdown.
London for example has seen price growth slide 13% to 3% during the last year.
While annual price stood at 8.8% in May 2016, half of the cities have seen quicker growth than one year ago. Cambridge experienced a significant drop from 13% to 2%, but all other cities, save for Oxford and Aberdeen, saw higher prices during the last quarter.
Bigger regional cities saw the largest increases in the last three months, with Nottingham and Birmingham seeing the highest rises of 3.8%. Newcastle recorded growth of 3.5%, while Manchester saw increases of 3.3%. Despite this, the report shows that house prices in cities such as these are rising off a low base supported by poor supply and low mortgage rates.
Affordability and uncertainty, driven by political and economic factors, are impacting on demand in London. The capital has seen the lowest annual growth for five years, though a slowdown in price inflation is showing signs of ending.
Hometrack’s report indicates that the London index is not expected to slip in negative year-on-year growth by the end of 2017.