UK House Prices Increase for First Time Since April, According to Nationwide
In August, the average price of a home rose by 0.2% month-on-month to £275,465, marking the first increase since April, as the market anticipates an interest rate decision.
By The Guardian
UK house prices saw a rise for the first time in four months in August, with the average price increasing by 0.2% month-on-month to £275,465, as reported by Nationwide. This follows a three-month decline in prices, during which a previously reported 0.1% rise in July was revised to a fall of 0.1%. Analysts had anticipated a modest increase of 0.1%.
On an annual basis, house prices were up 1.6% compared to August of the previous year, slightly exceeding the 1.4% increase recorded in July, but falling short of economists' expectations for a 2% annual rise.
Ian Futcher, a financial planner at Quilter, noted that the housing market is currently in a “holding pattern” as it awaits the Bank of England’s monetary policy committee meeting on 17 September, where a decision on the base interest rate, currently at 3.75%, will be made. He indicated that while a hold on rates is the most likely outcome, uncertainty remains, which could affect buyer confidence.
Robert Gardner, chief economist at Nationwide, commented on the impact of the rising energy price cap, which is expected to lead to higher bills this winter. He stated that while this poses inflation risks, there are signs that it is not significantly affecting buying and selling activity. He added that underlying affordability is improving as house price growth is lagging behind earnings growth, despite some offset from higher mortgage rates.
In July, the Bank of England reported that mortgage approvals for home purchases fell to their lowest level in over two years, with 56,053 approvals recorded, down from 58,215 in June. Over the past six months, the average monthly mortgage approvals have been around 60,800.