9:20 AM, 1st September 2022, About a month ago 2
The UK’s annual house price growth slowed to 10% in August – down from July’s 11%, according to the latest Nationwide house price index.
The data also reveals that prices rose 0.8% month-on-month after seasonal effects were taken into account.
And the average house price is £273,751 – that’s a £50,000 increase in just two years.
Robert Gardner, Nationwide’s chief economist, said: “While annual house price growth softened in August, it remained in double digits for the tenth month in a row – at 10.0%.
“Prices rose by 0.8% month-on-month, after taking account of seasonal effects – the thirteenth successive monthly increase. Indeed, in the past two years, the average house price has increased by almost £50,000.”
He added: “There are signs that the housing market is losing some momentum, with surveyors reporting fewer new buyer enquiries in recent months and the number of mortgage approvals for house purchases falling below pre-pandemic levels.
“However, the slowdown to date has been modest, and combined with a shortage of stock on the market, has meant that price growth has remained firm.”
He says that the market is expected to slow further as pressure on household budgets intensifies in the coming months, with inflation set to remain in double digits into next year.
Mr Gardner also points to the Bank of England which is widely expected to continue raising interest rates – and this will lead to the market cooling if this feeds through to mortgage rates, which have already increased noticeably in recent months.
Iain McKenzie, the chief executive of The Guild of Property Professionals, said: “With all the doom and gloom on the front pages recently, you would have thought that house prices would be going the opposite way, but it seems that the housing market doesn’t read the news.
“This is the thirteenth monthly rise in a row, with prices kept sky-high by limited housing supply on the market.”
He added: “The signs of a slowdown are growing; however, activity is starting to fall, at the same time as new mortgage approvals drop.
“Expected interest rate rises combined with soaring household costs will start to bite in the coming months.”
Mr McKenzie pointed out: “It’s almost difficult to believe that just two years ago the average house was worth £50,000 less than today.
“This house price growth is unlikely to continue but it still leaves many first-time buyers priced out of the market.
“Many people hoping to get on the ladder will have their fingers crossed that prices soften soon and allow them to take that first step.”