The latest data from Halifax has revealed that house prices in the three months to May were 1.9% higher than the same period a year earlier with the average house price now standing at £224,439.

Russell Galley, Managing Director, Halifax, said: “ These latest price changes reflect a relatively subdued UK housing market. After a sharp rise in January, mortgage approvals have softened in the past three months. Whilst both newly agreed sales and new buyer enquiries are showing signs of stabilisation having fallen in recent months.

The continuing strength of the labour market is supporting house prices. In the three months to March the number of full-time employees increased by 202,000, the biggest rise in three years. We are also seeing pay growth edging up and consumer price inflation falling, and as a result the squeeze on real earnings has started to ease. With interest rates still very low we see mortgage affordability at very manageable levels providing a further underpinning to prices.”