The ups and downs of the UK residential property market is borne out in the latest data published today (Tuesday September 13) by the Department for Communities and Local Government. The latest UK house price index includes data based on mortgage completions during the month of July 2011.

It shows that in July UK house prices decreased by 1.5% over the year and increased by 0.3% over the month, seasonally adjusted.

The average UK house price was £207,690, not seasonally adjusted, and average house prices were 0.7% lower over the quarter to July, compared to a quarterly decrease of 0.2% over from the quarter to April, seasonally adjusted.

Average prices decreased during the year in all UK countries; England was down 1.5%, Wales was down 0.1%, Scotland was down 1.8% and Northern Ireland was down 4.1%.

Average house prices decreased in eight of the nine English regions over the year to July 2011. The largest decrease was in the West Midlands at 4.6%, while the smallest was in the East and South East, both down 1%. London registered an annual house price increase of 0.9%.

Over the month to July there were average price rises in seven regions, ranging from 0.1% in Yorkshire and the Humber to 3.4% in the North West. There were average monthly price falls of 0.4% in the West Midlands and 0.8% in the North East.

Average house prices in July stood at £215,146 in England, £141,474 in Northern Ireland, £165,687 in Scotland and £150,161 in Wales. London remains the English region with the highest average house price at £347,271. The North East has the lowest average price at £133,163.

In England, southern regions including the East of England, London, the South East and South West all had average prices above the UK average in July.

Excluding London and the South East, the average UK price in July was £170,615, a decrease of 2.5% over the year.

The index also shows that prices paid by first time buyers were 0.5% lower on average than a year earlier and prices paid by former owner occupiers also decreased by 1.9%.

Prices for new properties were 6.7% higher on average than a year earlier whilst prices for pre-owned dwellings decreased by 2.1%.

According to a recent survey, the level of sales has dipped to new lows with the general state of the economy continuing to be a large influencing factor.

Economic gloom has taken its toll on the housing markets as only 14 homes were sold per estate agent in the three months to August. The last time such a situation occurred was June 2009.

The Royal Institution of Chartered Surveyors (RICS) found that 70% of surveyors questioned felt that the lack of mortgage financing was due to a negative impact on transactions, with many homes now falling into negative equity.

The organisation’s latest Housing Market survey revealed that the number of property sales per surveyor in the three months to the end of August fell to an average of 14, the lowest level since June 2009.

Meanwhile, surveyors had an average of 67 properties on their books in August, compared to 70 in July.

Nearly eight in 10 surveyors (79%) believe that fears about the economy are responsible for the sluggish housing market.

Meanwhile, new instructions, which indicate supply levels to the market, moved from a net balance of -8% to 0%.

RICS says the sluggish market contributed to the downbeat pricing picture in August, with 23% more surveyors reporting prices fell rather than rose, compared to 22% in July.

Price expectations also fell, as a net balance of 23% anticipated prices to decline rather than rise over the next three months.

However, sales expectations remain positive for the coming months with a net balance of 17% expecting a pick up in activity.

Alan Collett, a housing spokesman at RICS, says: “For the time being, our indicators suggest that demand for homes remains broadly steady, albeit at relatively low levels, despite the renewed bout of economic gloom.

“However, the risk is that the worsening economic picture will gradually begin to have a more material impact on sentiment and discourage potential house purchasers even where mortgage finance is available.”