UK house prices grow at their slowest pace in four years

[LONDON] UK house prices recorded their slowest quarterly growth in four years, adding to signs that the market is cooling.

In the three months through May, prices grew 3.3 per cent compared with the same period a year earlier, lender Halifax said in a report on Wednesday. From a month earlier, house prices grew 0.4 per cent, the first increase this year, though Halifax said values have stagnated in the past quarter.

The report adds to plentiful evidence pointing to a slowdown in the property market; the annual growth compares with a peak of 10 per cent in March 2016. Faster inflation, weak wage growth, and higher stamp-duty tax rates have weakened activity, Halifax said. According to Nationwide Building Society, home prices fell for a third month in May, the worst streak for the market in eight years.

Nevertheless, the shortage of properties for sale could help support prices.

"The fact that the supply of new homes and existing properties available for sale remains low, combined with historically low mortgage rates and a high unemployment rate, is likely to support house price levels over the coming months," said Martin Ellis, Halifax housing economist.

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