London house price drag prompts UK's weakest gains since '13

London - Weakness in London house prices contributed to the UK’s slowest annual increase since 2013 last quarter.

Home prices in the capital grew 0.8%, compared to 13.7% at the same period in 2016, lender Halifax and IHS Markit said in a report on Wednesday. Nationally they rose 2.4% from a year earlier, slowing from their 3.6% gain in the first quarter.

The data provides the latest evidence of a “sustained slowdown” in UK property price inflation, according to Halifax. It attributes the cooling to affordability constraints, pressures on household finances, greater caution among buyers and the effect of tax changes on buy-to-let properties.

“London’s soft patch has clearly magnified the slowdown in UK house price inflation since 2016, but this weaker trend is not exclusive to the capital,” said Tim Moore, a senior economist at IHS Markit. “A generally cooling UK housing market appears to have emerged.”

Despite the slowdown, the average London house price climbed to £452 758 last quarter, around double the national level of £222 911.

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