The pace of house price increases in the UK stabilised in June, according to new official figures, while renters continue to suffer the pressure of rapidly rising rents.
The average home price rose 2.7 percent in the 12 months to June, unchanged from May, the Office for National Statistics (ONS) said.
This was the fourth consecutive month of annual price increases as momentum returned to the market after eight months of annual price declines.
The average cost of a home in June was £288,000.
In England and Wales, annual price increases slowed slightly in June compared with May, but increased in Scotland.
In England, the average house price was £305,000 (2.4% more than the previous year) and in Wales it was £216,000 (1.8% more than the previous year).
In Scotland, the average property price was £192,000, 4.3% more than a year ago.
The average house price in Northern Ireland was £185,000 between April and June, 6.4% higher than the same period a year ago.
Meanwhile, private rents across the country rose 8.6 percent in the period to July, averaging £1,319, according to ONS estimates.
This figure remained unchanged from the same month last year up to June and was below the record increase of 9.2% recorded in March.
Rent inflation in London reached 9.7% in July, with the average cost of a rental property at £2,114.
Nathan Emerson, CEO of Propertymark, said: “The rental market continues to feel the harsh reality of ongoing pressure on housing demand exceeding current supply.”
“This has a concrete impact on rental prices for consumers and tends to push prices even higher.
“It is vital that the supply and demand mismatch is addressed as a top priority to mitigate the ‘nine applications per available property’ trend we are currently seeing.”
Sarah Coles, head of private finance at Hargreaves Lansdown, said rent increases remained “breathtaking” despite the pace slowing.
“Faced with higher mortgage costs, tighter tax rules and the likelihood of stricter legislation, landlords continue to sell their homes,” she said.
“Meanwhile, due to the increasing number of tenants, it is becoming increasingly difficult to get a property, even if you are willing to pay exorbitant prices. It is difficult to imagine that the situation will ever improve.”
Meanwhile, Elliott Jordan-Doak, senior UK economist at Pantheon Macroeconomics, said the continued rise in house prices shows the “resilience of the housing market to high interest rates”.
“The outlook for mortgage rates should boost demand in the coming months,” he added.
“The typical two-year fixed-rate mortgage rate fell to 5% in July and will fall to 4.3% by year-end if market prices the MPC (Monetary Policy Committee) rate cuts correctly.”
