London overtaken by the East of England as region with the fastest-growing house prices

The East of England has overtaken London to become the region with the fastest-growing house prices.

According to the Office for National Statistics (ONS), the average house price in the East rose 14.3% over the year to June 2016, hitting £270,000.

London's average house price rose 12.6% annually to £472,000. Price growth is slowing in the city as property tax hikes on investors and expensive homes, uncertainty surrounding Brexit, and affordability issues weigh on London's housing market.

The average UK house price rose 8.7% to £214,000. England's average rose 9.3% to £229,000; Wales saw house prices grow on average by 4.9% to £145,000; Scotland by 4.6% to £143,000; and Northern Ireland by 7.9% to £123,000.

After the EU referendum on 23 June, in which the UK voted for Brexit, some fear the economy will slip into recession as businesses delay or cut investment amid the political and financial uncertainty.

In response, the Bank of England has slashed its base rate in half to 0.25% — a new all-time-low — and boosted its economic stimulus packages by £170bn.

These measures should help hold down the cost of mortgage credit. Alongside schemes such as Help to Buy and shared ownership, demand for housing is expected to remain robust.

Though house price growth is predicted by many analysts to slow over the coming years, prices should be supported by the ongoing supply shortage, with around half the new homes needed a year currently being built.

How house prices are changing

Source: ONS House Price Index, June 2016