House prices up 5 percent year-on-year

A couple pass the window of an estate agent in south London April 29, 2010. REUTERS/Toby Melville

LONDON (Reuters) - Asking prices for homes rose 5 percent higher on a year ago in June, up from a 4.3 percent annual gain in May, property website Rightmove said on Monday, but it said the market’s recovery could stall this year.

Rightmove reported an average June asking price of 237,767 pounds and said prices had increased by 0.3 percent during the month on an unadjusted basis, slowing from a 0.7 percent monthly gain in May.

The website said there was evidence to suggest the housing market recovery was struggling to maintain momentum, noting that “new sellers” asking prices give an early indicator of the mood and future direction of the housing market”.

Rightmove commercial director Miles Shipside said a continued dearth of mortgage availability and a recent surge in sellers were weighing on the market.

“These factors are likely to put an end to this year’s recovery in house prices,” Shipside said.

Reporting by Matt Falloon; editing by Patrick Graham