UK house prices were up across the board last month but sales have dropped

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The number of available properties has increased in London and the UK as a whole (Source: Getty)

House prices are increasing across the country, but the number of sales being completed has dropped.

British house prices rose by 2.5 per cent in June, according to estate agent Haart. But they declined 0.6 per cent on the same period last year.

Read more: Here's how much UK house prices fell in June

London property prices rose 1.6 per cent on the month, marking a 1.1 per cent annual increase.

The news follows jitters that the UK could be heading for a house price crash.

Levels of available property in June were up 14 per cent in London and 11 per cent elsewhere. Haart said it had noticed increased stock since the general election, and was hoping this pointed towards increased activity in the coming months.

But sales declined outside the capital. The national number of exchanges fell 1 per cent on the month, with a decline of 11.7 per cent since last year.

London sales climbed 3.7 per cent but still fell 9.4 per cent annually.

Read more: Double, double, London house prices bubble?

Paul Smith, CEO of haart estate agents explained: “One of the key reasons that transactions are so far behind where they were last year is the government’s changes to the buy-to-let market, including the stamp duty surcharge, which has dampened the market significantly. This is particularly the case in London, which has seen buy-to-let landlords flee the market."

Read more: Renters rejoice: Landlords are reluctant to increase prices

There was also a downturn in the numbers of new and first-time buyers entering the market compared to last year. First-time buyer numbers dropped 46.3 per cent.

In London, the ratio of new buyers to each property is now 13:1, a monthly drop of 19.4 per cent and 26.3 per cent on the year.

Read more: Help to buy has built up housebuilders - but it can break them down, too

Smith added that "the fundamental issue in the market remains affordability, as pulling together the money for both a deposit and stamp continues to be a growing problem for aspiring home owners, and home movers."

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