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&#39Soft landing&#39 for house prices

The housing market is heading for a soft landing rather than a crash but the slowdown is spreading out from London to the South-East and East Anglia, according to research by website

The areas which have previously seen the strongest surges in house prices – London, South-East and East Anglia – now have the smallest increases over the year to February at 18.3 per cent, 19.5 per cent and 21.1 per cent respectively, while the bigger rises over the year are in the West Midlands at 36.2 per cent and Wales at 34.9 per cent.

Annual house price inflation across the UK over a year to February fell to 23.5 per cent from 26.5 per cent for January while the rate of increase for February was 2 per cent compared with 4.5 per cent over the same period last year.

Rightmove says the average asking price for a house is now £158,639, up from £128,490 last February and £155,481 in January.

Rightmove says house prices have been tempered by an increasing amount of properties coming on to the market compared with last year when their were stock shortages.

It claims that although there is a continuing demand, potential purchasers are taking a much more cautious approach and want to see which way the market is heading before committing themselves.

Its analysis is based on asking prices for properties marketed by its member estate agents, covering 30 per cent of the market in England and Wales.

Managing director Ed Williams says: “After the boom market of 2002, we are in a transitional phase as the market returns to a natural equilibrium. Supply of property is good and underlying demand is still there, helped by low interest rates and sustained employment levels, even if people are a little cautious for the time being. Despite what some people have been saying, it really does look as if we are heading for a soft landing.”


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