A record high in average UK house prices of £227,000 was recorded for the year to April, a rise of 3.9% according to new figures from the Office for National Statistics (ONS).
Annual property inflation of 1% was recorded in London, with a surprise 2.4% in house prices recorded in the capital.
The high average cost of a home in London of £485,000 could be deterring buyers as the capital registered the lowest growth of all regions nationally.
London flats and maisonettes have grown by 1% in the year for a new average cost of £202,052.
Semi detached homes increased by the most in London at 5.3%, with terraced homes (4.7%) and detached homes (3.8%) also seeing rises.
The recent decision of the Bank of England's Monetary Policy Committee to hold rates at 0.5% has helped to keep mortgages relatively affordable.
Jeremy Leaf, an estate agent says that:
"Behind the numbers bears out what we’re finding on the High Street – transactions are falling while listings have increased but not making up for an historic shortfall whereas demand is relatively flat.
As a result, the increase in house prices is more to do with the lack of supply of appropriate property in places where people most want to live rather than a marked improvement in confidence."
Mike Scott of Yopa said:
"Over the next few months, it is likely that prices will continue to rise, but with the annual rate of growth falling closer to 2 per cent than 4 per cent.
London is also likely to fall further behind, perhaps turning negative as has already happened in other reports that use more recent data."
Are you thinking of making a move? Your Mortgage adviser can help you to secure the home or investment you are looking for.
Information is based on our current understanding of taxation legislation and regulations which is subject to change.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Our charges are usually between £395 and £995 depending on the type and amount of borrowing required and individual circumstances.
House prices hit a new record high, as flats suffer a slowdown but semi-detached homes are in demand