According to the latest figures from the Halifax House Price Index, the average home in the UK is now valued at over £175,000 for the first time.
The increase in prices in the first quarter of 2006 was 1.6 per cent, slowing from the 2.3 per cent gain registered in the fourth quarter of 2005.
Although still rising, the inflation of the housing market appears to be slowing when compared to previous years.
The current annual rate is 6.2 per cent, which although higher than the slump in the third quarter last year is down on the 9.7 per cent high of growth recorded in the first quarter of 2005.
Martin Ellis, chief economist at Halifax, commented: "The rise in prices in the first three months of 2006 was smaller than the gains recorded in the two final quarters of 2005, signs that the housing market may be beginning to level off."
Mr Ellis attributed the slow-down in demand to a "weakening labour market" and "recent hikes in utility and council tax bills". The high level of house prices in relation to average earnings in the UK at the moment was also to blame, he said.
The largest gains in the first quarter of 2006 were seen in Wales (4.5 per cent), East Anglia (3.4 per cent) and the East Midlands (three per cent), with the average price in both the East Midlands and Wales surpassing £150,000 for the first time.To read more about property, click here.
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