Source: Sharecast
Prices were down 0.2% on the month following a 0.1% drop in July. On the year, prices declined by 0.4% in August following 0.1% growth the month before. The average price of a home stood at £298,468, down from £299,153.
Northern Ireland continued to record the UK’s strongest annual growth, at 6.9 %, while Scotland also continued to see solid growth, with prices rising 3.5% over the past year. Annual growth in Wales stood at 0.6% in August, while within England, growth remained strongest in northern regions, Lloyds said.
By contrast, price growth across much of southern England remained under pressure, reflecting the greater affordability challenge caused by higher average prices. The South East saw the largest decline, with prices down 1.6% year-on-year, followed by Greater London, where prices fell 1.5%.
Andrew Asaam, mortgages director at Lloyds, said: "The housing market has faced a more difficult backdrop in recent months, with the impact of global events on inflation and borrowing costs creating greater economic uncertainty. What we're not seeing is a rush of homeowners cutting prices. But more are choosing to sit tight, with sellers reluctant to accept offers they feel are too low, while some buyers are waiting to see how conditions develop.
"As a result, fewer homes are changing hands, with latest industry figures showing mortgage approvals now at their lowest level since the start of 2024. It's also important to keep recent price movements in perspective. Average house prices remain around 25% higher than they were at the end of 2019, despite the substantial increase to interest rates seen over recent years. The market's adjustment to higher borrowing costs has been gradual, with wage growth helping to offset some of the pressure on affordability. The recent modest declines in prices are best viewed in that wider context.
"We expect the market to remain fairly subdued in the months ahead, but this will likely only have a limited impact on house prices. While affordability remains a challenge, wages continue to grow and employment has held up better than many anticipated. This will help to support demand from those who need or want to move."