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House price growth slows as supply concerns remain

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House price inflation in March was 3.8 per cent year-on-year, down from 5.1 per cent in February, according to the latest Halifax house price index.

House prices in the three months to March were 0.1 per cent higher than in the previous quarter.

The average UK house price in March was £219,755.

House sales in February were 1 per cent lower than in January, the first decline for five months.

Halifax housing economist Martin Ellis says: A lengthy period of rapid house price growth has made it increasingly difficult for many to purchase a home as income growth has failed to keep up, which appears to have curbed housing demand.

“Nonetheless, the supply of both new homes and existing properties available for sale remains low. This, together with historically very low mortgage rates, is likely to support house price levels over the coming months.”

The biggest gap between rising property values and earnings was in Haringey in London.

House prices in the borough increased by an average of £139,803 over the last two years, exceeding average take-home earnings in the area of £48,353 over the same period.

Legal & General Mortgage Club director Jeremy Duncombe says: March’s figures paint a similar picture to last month’s, showing a continual rise in annual house price inflation.

“Despite many homeowners welcoming these figures, this constant increase in house prices will fall heavily on the shoulders of aspirational homeowners, hoping to make that jump from ‘Generation Rent’ into the home-ownership club.”

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