House price growth has slowed in 16 of the 20 cities analysed monthly by Hometrack, with London again performing particularly sluggishly after powering ahead early in 2014.
The rate of house price growth in London slowed by two-thirds in the last quarter compared to the 12 month average (0.5 per cent compared to 1.4 per cent) with Edinburgh, Glasgow, Southampton, Bristol and Birmingham now all registering higher inflation than the capital in the last three months.
House prices are above their 2007 peak in eight cities with London (30.5 per cent), Cambridge (28.7 per cent) and Oxford (21.9 per cent) leading the pack but these markets are starting to register the clearest slowdown as the year draws to a close.
This translated to an average annual increase in London property values of £57,000, which is nearly four times the national average of £15,200 and almost twice the UK's average income. Liverpool recorded the lowest increase in values with just £3,000 added to house prices in the last year.
The Scottish cities of Edinburgh (1.8 per cent) and Glasgow (0.9 per cent) registered the fastest house price inflation in the last quarter, as demand fed back into the market post-referendum.
In a reversal of fortune, the former high growth cities of Cambridge and Aberdeen have seen the fastest slowdown with falls of 0.2 per cent and 0.4 per cent respectively.
The Aberdeen economy is closely related to the health of the oil industry and a weakening oil price is impacting the housing market. The slowdown in London will act as a drag on the UK rate of house price growth over the next 12 months. The rate of growth in house prices is starting to lose momentum across other cities in southern England, while across the rest of the country modest levels of house price appreciation continue as prices rise off a low base says Richard Donnell, Hometrack's research director.
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