"It’s concerning but not surprising to see a further - and more pronounced - fall in the capital’s prices in June."
The main contribution to the increase in UK house prices came from England, where house prices increased by 5.2% over the year to June 2017, with the average price in England now £240,000.
Wales saw house prices increase by 3.6% over the last 12 months to stand at £152,000. In Scotland, the average price increased by 2.9% over the year to stand at £144,000. The average price in Northern Ireland currently stands at £129,000, an increase of 4.4% over the year to Q2 2017.
The East of England showed the highest annual growth, with prices increasing by 7.2% in the year to June 2017. This was followed by the East Midlands at 7.1%. The lowest annual growth was in the North East, where prices increased by 2.5% over the year, followed by London at 2.9%.
Jonathan Hopper, managing director of Garrington Property Finders, commented: “After the previous month’s data showed a decline in London’s house prices, it’s concerning but not surprising to see a further - and more pronounced - fall in the capital’s prices in June.
"There is a degree of inevitability about prices cooling, as house price inflation in the capital raced ahead of wage inflation for several years, but ultimately this situation was always going to be unsustainable.
“Across the country as a whole, house prices remained largely flat, although a few regions outside of London also experienced a slowdown in property price growth.
“Although the ongoing lack of supply has continued to prop up prices, in practice there are many buyers closely watching these movements in the market and managing to secure weighty discounts.
“Sellers who are conscious of this and are both pragmatic and flexible in their approach to pricing are most likely to guarantee a sale in today's market."
Jeremy Leaf, north London estate agent and former RICS residential chairman, added: "These figures are interesting because they don’t actually say very much. They show a fairly stable market at a time when we might have expected more nervousness among buyers and sellers. What we are seeing on the ground is a determination to get on with property transactions even if that means negotiating harder to make sure they go through.
"Looking forward we don’t expect to see any significant changes but it is a good time to do business when expectations are relatively flat and the market is left to more serious buyers and sellers.
"The fact that inflation has fallen from 2.9% to 2.6% and is staying there is good news for the housing market as expenditure won’t feel any more squeezed than it has done over the past few months and may even persuade some to take the plunge."
