Commenting on the figures, Nationwide’s chief economist Robert Gardiner said:
“Average house prices in the UK fell by 1.0% in the second quarter of the year, after allowing for usual seasonal effects. Prices were down 1.1% compared with the same quarter in 2011.
“London saw the strongest quarterly growth rate, with prices up 1.0% quarter-on-quarter. Whilst the annual rate of growth moderated a little from 2.3% to 1.2%, average prices in the capital have now virtually recovered to their 2007 peak.
“The north/south divide amongst the English regions continued in Q2, with house price growth in southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) exceeding that of northern England (West Midlands, East Midlands, Yorkshire & Humberside, North West and North) for the thirtieth consecutive quarter. The North West was the worst performing English region, with prices down 4.1% year-on-year.
“Scotland was the worst performing area on a quarterly basis, with prices falling 2.0% during the second quarter. This pushed the annual rate of change down to -2.3%.
“Wales saw a third successive quarter of price falls, with a seasonally adjusted fall of 1.1% in Q2. On an annual basis, prices were down 5.3% compared with 2011.
“Northern Ireland continued to see price falls, with average prices down 10.6% year-on-year.
Average house prices in England were unchanged during the second quarter, and marginally lower than one year ago.
The Outer Metropolitan was the best performing region, with prices up 1.8% year-on-year. The North West continued to be the worst performing English region, with prices down 4.1% compared with Q2 2011.
The gap in house prices between southern England (South West, Outer South East, Outer Metropolitan, London and East Anglia) and northern England (West Midlands, East Midlands, Yorkshire & Humberside, North West and North), has continued to widen, with the south seeing stronger growth for the thirtieth consecutive quarter. Average house prices in the south are now around £96,000 higher than those in the north, a record high.
Amongst England’s major towns and cities, Liverpool saw the strongest price growth over the last twelve months, with prices up 10%. Carlisle remained the worst performing city, with prices falling 13% over the same period.
Scotland saw a 2.0% seasonally adjusted fall in the second quarter, while the annual rate of change also deteriorated from -0.2% to -2.3%. Aberdeen City nudged ahead of Edinburgh to become Scotland’s most expensive area.
Cardiff, the most expensive area in Wales, was also the strongest performing over the year. Wales recorded its third successive quarter of price falls in Q2, with a seasonally adjusted fall of 1.1%. On an annual basis, prices were down 5.3% compared with 2011, making Wales the second weakest region behind Northern Ireland.
House prices continue to fall in Northern Ireland, with prices in the second quarter of 2012 down 10.6% year on-year. All areas have seen prices fall over the past 12 months with the largest declines seen in the City of Belfast, with prices down 15% year-on-year.
Annual house price growth in London slowed to 1.2% in Q2, from 2.3% in Q1. Average prices broke back through the £300,000 barrier and are now just 0.4% below their 2007 peak. Greenwich saw the strongest growth, with prices up 14% year-on-year, whilst Hackney was the weakest performing borough.
Major towns and cities
Of the UK’s major towns and cities Liverpool, Nottingham, Brighton, Cambridge and London saw the biggest price rises and Belfast, Carlisle, Newcastle, Manchester and Edinburgh saw the biggest falls.
See the detailed reports and graphs.
1. Indices and average prices for the UK and the regions are produced using Nationwide's updated mix adjusted House Price Methodology which was introduced with effect from the first quarter of 1995. All changes are nominal and do not allow for inflation. The methodology can be found on our website
2. Price indices are seasonally adjusted using the US Bureau of the Census X12 method. Quarterly series are seasonally adjusted using data since 1973. The seasonal adjustment is recalculated quarterly and may lead to revisions.
3. The price changes in the sub regional, local authority and major towns and cities tables are based on the price per unit area of the properties in the sample rather than the mix-adjusted methodology used for the 13 regions. The average price per square foot in each of the sub-regions is grossed up by the average square footage in a particular region to arrive at an average house price. Unlike Nationwide’s main index, this methodology does not take into account the different mix of properties transacted and is therefore a simplification.
4. Sub-regional figures are therefore not directly comparable with regional prices. Samples are substantially smaller than at a regional level and figures should not be relied upon for any critical application. Due to greater volatility, sub-regional prices are smoothed over two quarters.
5. The Nationwide House Price Index is prepared from information which we believe is collated with care, but no representation is made as to its accuracy or completeness. We reserve the right to vary our methodology and to edit or discontinue the whole or any part of the Index at any time, for regulatory or other reasons. Persons seeking to place reliance on the Index for their own or third party commercial purposes do so entirely at their own risk.