The monthly rate of house price growth halved over June with average prices rising by 0.3% compared to 0.6% in May, and a recent high of 0.8% in March 2007, according to Hometrack’s Housing Intelligence Business.
The annual rate of house price growth also slowed to 6.4% (from 6.7% in May), a trend that is set to continue over the second half of the year on the back of rising levels of supply and weaker demand in the face of higher interest rates.

The slowdown is being driven by a mis-match between supply and demand with price rises over June limited to 28% of the country, down from 44% in April. For the fourth month in a row, the growth of the supply of homes coming to the market (+12.4%) exceeded the growth in new buyers (+5%) with the volume of homes coming to the market doubling over June.
Richard Donnell, Hometrack’s director of research, said: “The growth in supply comes at a time when demand is faltering on the back of recent increases in interest rates and widespread fears of further rate rises to come. With much of the new supply coming to the market from discretionary sellers looking to achieve close to the full asking price, it seems likely that the average time to sell property will increase in the months ahead with a slowdown in sales volumes and a switch to a buyers market.”