House price growth shows 'moderation', Nationwide says
House price growth is showing "tentative signs of moderation", according to the UK's second biggest mortgage lender.
Nationwide said house price inflation was slowing, on both a monthly and quarterly basis.
However, when measured annually, price growth accelerated in March, with prices up 9.5% from a year earlier.
Meanwhile, the gap between house prices in London and the rest of the UK has reached a record.
Average values in the capital are now more than double those in the rest of the UK, at £362,699.
The overall average house value in the UK now stands at £180,264, the highest since January 2008, although that figure is still 3% below the 2007 house price peak.Continue reading the main story
Year on year % change
Although March saw the 15th successive monthly increase in prices, the rate of increase is slowing. Prices rose 0.4% last month, the Nationwide said, compared with a 0.7% increase in February.
In the three months to March, prices rose by an average of 2.6%, down from a 3% rise in the three months to February.
Further evidence of a slowdown came from the Bank of England this week, which reported a sharp fall in the number of mortgage approvals in February, following an unusually active January.
"There are some tentative signs of moderation," said Nationwide's chief economist, Robert Gardner.
However, he added that annual price growth was "continuing to run at a robust pace" and that low mortgage rates and an improved economic outlook meant the housing market recovery was now "firmly established".London gap
London house prices in the first quarter of this year were up 18% compared with the same period in 2013, and prices in the capital are now 20% above their 2007 peak, Nationwide said.
"The gap between house prices in London and the rest of the UK is the widest it's ever been," Mr Gardner added.
However, the figures show that house prices are surging in other cities too.
Prices in Manchester have risen by 18% over the past 12 months, while prices in both Brighton and Cambridge rose by 14%.
In contrast, prices in Sunderland rose by just 1%, and in Coventry by 2%.
Despite this, Nationwide said all UK regions saw house price growth for the third quarter in a row.
The lender also reiterated its concern that not enough new properties were available to satisfy the growing demand, with new builds 40% below pre-crisis levels.
The Nationwide's figures are based on a sample of its own lending, and differ from other data.Help to Buy
Last week the Office for National Statistics said UK house prices in January were up 6.8% compared with a year earlier, driven by a 13.2% increase in London.
The recent surge in prices has been put down to continuing low mortgage rates, and the impact of the government's Help to Buy scheme.
The first part of the scheme offers government loans of up to 20% on new homes.
The second part, the mortgage guarantee scheme, insures lenders against losses if homeowners default on repayments.
In the Budget, Chancellor George Osborne confirmed plans to extend the first phase of Help to Buy - the equity loan offer - until the end of the decade.
But the Bank of England, among others, has warned the scheme could create a housing market bubble.