UK house prices dip by 0.1% in February as London cooldown continues
House prices dipped by 0.1% month on month in February amid a cooldown mainly driven by London, which recorded its weakest performance since 2009, an official report has said.
Across the UK, the average house price was £225,000, marking a 4.4% increase on a year earlier, according to figures released jointly by the Office for National Statistics (ONS), Land Registry and other bodies.
The annual growth rate slowed from a 4.7% rise in January.
The dip in prices was "driven mainly by a fall in London", the report said.
Average house prices in the capital decreased by 1% in the year to February, continuing the London slowdown since mid-2016, the report said.
It said: "This is the lowest annual growth in London since September 2009, when it was negative 3.2%."
London continues to be the region with the highest average house price, at £472,000.
In England, house prices increased by 4.1% over the year to February, reaching £242,000 on average.
Within England, the West Midlands showed the highest annual house price growth, with prices increasing by 7.3% in the year to February. This was followed by the East Midlands, which saw a 6.3% increase.
Wales saw house prices increase by 4.8% over the previous 12 months to reach £153,000.
In Scotland, the average price increased by 6.2% over the year to stand at £144,000.
The average price in Northern Ireland was £130,000, an increase of 4.3% over the year.
Mike Scott, chief property analyst at estate agent Yopa, said: "Average house prices in London are down 1%, its worst performance since September 2009.
"With no sign of a turnaround in the London market, we expect it to continue to be the worst-performing region for the rest of this year while prices carry on increasing in the rest of the country, albeit at a slower rate."
Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said: "Looking at the last few housing market surveys, a clear pattern is beginning to emerge.
"We are seeing a two-tier market developing, with higher national property prices masking a stagnating, or even falling prices, in London.
"As a result, the old north-south divide is turning on its head, with northern areas steaming ahead much faster than the rather sluggish south."
He continued: "However, we should bear in mind that the figures reflect what was happening in the period immediately before and after Christmas so we should be hopeful that the market will show more improvement as the figures emerge for the traditionally busier spring period."
Mark Manning, managing director of Leeds-based estate agent Manning Stainton, said: "Although nationally house price growth has decreased slightly in February, we've experienced strong growth in Leeds...
"New instructions are also up 3% year on year and first-time buyer activity is increasing."
Thomas Fisher, an economist at PwC, said: "Regionally, the picture remains mixed, with London diverging from the rest of the country...
"We broadly expect current market conditions to continue, projecting UK-wide house price inflation to be around 4% in 2018."