Annual house price growth sat below 1% for an eighth straight month in July standing at 0.3%, the latest House Price Index from the Nationwide has revealed.
The building society found that average price of a house in July was £217,663 with prices increasing by 0.3% during the month.
The same level of growth was reported on a quarterly and annual basis in July. Additionally the figures also show first-time buyer transaction numbers have now almost recovered to normal pre-crisis levels.
Robert Gardner, Nationwide’s chief economist, said: “While house price growth has remained fairly stable, there have been mixed signals from the property market in recent months.
“Surveyors report that new buyer enquiries have increased a little, though key consumer confidence indicators remain subdued. Data on the number of property transactions points to a slowdown in activity, though the number of mortgages approved for house purchase has remained broadly stable.
“Housing market trends will remain heavily dependent on developments in the broader economy. In the near term, healthy labour market conditions and low borrowing costs will provide underlying support, though uncertainty is likely to continue to exert a drag on sentiment and activity.
Mark Harris, chief executive of SPF Private Clients, attributed the results to an ongoing reluctance of some elements of the market to move home.
He added: “First-time buyer numbers have recovered to pre-crisis norms but there is still a lack of people willing to move home. Lack of properties on the market is undoubtedly playing a part as sellers wait and see what happens with Brexit before making a decision.
“The cost of moving is also having an impact, with homeowners remortgaging and releasing cash to improve their homes, rather than shelling out tens of thousands of pounds on stamp duty.
“The number of mortgages approved for house purchase remains broadly stable with lenders keen to lend. Several lenders, including NatWest, have been reducing pricing across their product ranges, while others compete for business by tweaking criteria to make it more favourable, such as lengthening maximum mortgage terms and loan sizes.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman, looked to the positives in the figures.
He said: “The Nationwide figures are always a good indicator of market strength, not least because of their longevity and accuracy. These confirm what we are finding on the ground – that the market is very much in limbo on the one hand underpinned by near record low mortgage rates and improving affordability but on the other, not moving ahead as we might have expected.
“One of the reasons for the lack of activity is clearly political uncertainty but there is no doubt that talk of changes to stamp duty is also weighing on perspective sellers’ minds.
“Fortunately, first-time buyers are slowly returning, taking advantage of buy-to-let landlord caution following various tax and regulation changes. Looking forward, we don’t expect the situation to change too radically until there is more clarity on the political front, although there is no doubt some buyers are looking beyond Brexit and making the most of more realistic pricing.”