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UK house prices hit record high despite inflation rate drop

19 August 2014 Last updated at 20:10 BST

The rate of inflation fell from 1.9% to 1.6% in the 12 months to June but house prices in the UK still reached a record high.

People buying second homes, or places to retire to, are increasing the prices making it more difficult for locals to afford houses where they live.

Houses in the Cotswolds are less affordable than those in London when wages are taken into account.

Simon Gompertz reports from Stow on the Wold.

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