Northern England remains Britain’s strongest-performing housing market, although growth in the leading regions is beginning to lose momentum.

The average house price across Great Britain reached £329,500 in July, up 1.7% from a year earlier, according to the latest e.surv House Price Index.

Yorkshire and the Humber recorded the strongest annual growth at 4.0%, followed by the North West at 3.6%. However, the latest quarterly increases in both regions were weaker than their average quarterly growth over the previous 12 months.

A similar slowdown was recorded across other parts of northern England, the Midlands and Wales. Prices continued to rise, but at a more measured pace after a period of comparatively strong growth.

Rob Owens, head of research at e.surv, said: “Momentum is easing in the regions that have led the market this year. Yorkshire and the Humber and the North West remain the strongest-performing regions, underlining the ongoing appeal of more affordable markets outside the South East.

“Recent growth is now running below the pace seen over the past 12 months, so the gap is narrowing from the top rather than because weaker markets are catching up.

“That is happening against a backdrop of higher borrowing costs and affordability pressures, and the same pattern is visible across northern England, the Midlands and Wales, as well as in several larger cities.

“The latest data shows house prices are still rising across these areas, but the pace is becoming more measured than earlier in the year.

“Looking closer at cities, this easing of momentum is present across Sheffield, Liverpool, Birmingham, Newcastle and Bristol, and is less pronounced in Leeds and Manchester.

“Overall, northern England remains Britain’s house price growth leader, but momentum is now easing at the top of the market.”