Average house prices soar 10.6 per cent in the North…

Average house prices soar 10.6 per cent in the North East, but signs of a slowdown in the market

Average house prices in the UK hit a new record in June, with the North East seeing double-digit growth, according to the Nationwide Building Society house price index. The average cost of a house in the region is now £159,283, which is 10.6% more than in June 2021.

But there are “tentative signs of a slowdown”, according to an index. Across the UK, the average house price in June was £271,613, up by just 0.3% month on month.

Since the start of the pandemic in 2020, house prices in the North East have risen by 22.9%. That means, if your house was worth £200,000 in 2020, it will on average be worth around £246,000 now.

The Nationwide has a house price index calculator. You can enter your region (North) and see how much your house has increased in value.

Robert Gardner, Nationwide’s chief economist, said: “The price of a typical UK home climbed to a new record high of £271,613, with average prices increasing by over £26,000 in the past year. There are tentative signs of a slowdown, with the number of mortgages approved for house purchases falling back towards pre-pandemic levels in April and surveyors reporting some softening in new buyer inquiries.

“Nevertheless, the housing market has retained a surprising amount of momentum given the mounting pressure on household budgets from high inflation, which has already driven consumer confidence to a record low. Part of the resilience is likely to reflect the current strength of the labour market, where the number of job vacancies has exceeded the number of unemployed people in recent months.”

Gardner said that, at the same time, the stock of homes on the market has remained low, keeping an upward pressure on house prices. “The market is expected to slow further as pressure on household finances intensifies in the coming quarters, with inflation expected to reach double digits towards the end of the year.”

Nationwide also says the prospect of rising interest rates will cool the market. Already, quarterly figures show a softening of house price growth in many regions in the three months to June.

Gardner added: “Within northern England, the North West was the strongest-performing region, with price growth picking up to 13.3% year on year, from 12.4% in the first quarter. London remained the weakest-performing UK region, with annual price growth slowing to 6.0%, from 7.4% in the previous quarter.”

Nicky Stevenson, managing director of agent group Fine & Country, said: “Increased borrowing costs have come at a time when disposable incomes are already shrinking and the UK is edging closer to recession. These pressures are bound to stretch affordability in the months ahead with inflation still to peak and more aggressive monetary tightening now being signalled by the Bank of England.”

Jason Tebb, chief executive of property search website OnTheMarket.com, said: “A subtle rebalancing continues as more stock comes to market. This is partly down to the seasonal effects of summer, traditionally a time when you would expect increased stock to become available.”

Here are average house prices in the second quarter of 2022 followed by the annual increase in prices, according to Nationwide Building Society:

– North East, £159,283, 10.6%

– South West, £318,325, 14.7%

– East Anglia, £289,024, 14.2%

– Wales, £208,309, 13.4%

– North West, £213,888, 13.3%

– West Midlands, £244,167, 11.8%

– Yorkshire and the Humber, £205,714, 11.8%

– East Midlands, £234,828, 11.4%

– Outer South East, £348,564, 11.1%

– Northern Ireland, £181,550, 11.0%

– Outer Metropolitan, £433,558, 10.0%