Average house prices in the United Kingdom in May were 3.9 per cent higher than a year earlier, after a 3.6 per cent rise in the year to April, the Office for National Statistics said this week.

House price growth has slowed sharply after hitting a two-year high of 7.0 per cent in March when buyers rushed to complete property sales before the end of a tax break on many house purchases.

Annual growth in private-sector rents slowed to 6.7 per cent in the 12 months to June from 7.0 per cent in May, the ONS added.