House prices held steady in August with 0.1% monthly increase

House prices held steady in August with a 0.1% month-on-month increase, according to an index.

Across the UK, the average house price was £229,958, marking a 3.7% increase on a year earlier, Halifax said.

Annual price growth accelerated from a 3.3% increase in July – and the 3.7% rise in August was the highest year-on-year increase since November 2017.

Halifax managing director Russell Galley said: “With the average house price now £229,958, prices in the three months to August were also 1.9% higher than in the previous quarter.

“While the pace of employment growth has recently slowed, a low unemployment rate and a gradual pick-up in wage growth are helping to support household finances.

“This has been accompanied by interest rates still remaining at a historically low rate and a stable, yet constrained, supply of new homes on to the market further supporting house prices.”

Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics), said the snapshot of housing market performance “is sending a mixed message”.

“Prices are rising more slowly on a monthly basis but accelerating when annualised,” he said.

“What we are finding on the ground is a market largely stuck in neutral – shortage of stock is supporting modest price increases, particularly outside London.

“There is an opportunity now for serious sellers to take advantage of increased buyer activity, which we have already encountered, as many return from holidays keen to make decisions about property and move before Christmas if possible.

“But both buyers and sellers need to come to terms with new market realities. Those who do will take advantage; otherwise, nothing much is likely to change.”

Howard Archer, chief economic adviser at EY Item Club, said: “We suspect that any meaningful housing market upturn will remain elusive over the coming months.

“We expect house price gains over 2018 will be limited to around 2.5%. At this stage, we expect a similar rise (around 2.5%) in 2019.”