UK house prices rise for first time in eight months
UK house prices rose by 0.5% in April after seven months of declines, according to Nationwide building society.
The modest increase took the average price of a home to £260,441 last month, from £257,122 in March. Compared with April last year, prices were down 2.7%, after a 3.1% annual decline in March.
The Nationwide chief economist, Robert Gardner, said the latest figures suggested there were “tentative signs of a recovery”. Property prices are still 4% below their August peak.
He noted that according to Bank of England data, the number of mortgages approved for house purchase in February was nearly 40% below the level a year earlier, and about a third lower than pre-pandemic levels. However, in recent months industry data on mortgage applications point to signs of a pickup.
“This chimes with recent shifts in consumer sentiment,” he said. “While confidence remains subdued by historic standards, people’s views of their own financial position over the next 12 months, and general economic conditions in the year ahead, have both improved markedly in recent months.”
“If inflation falls sharply in the second half of the year, as most analysts and the Bank of England expect, this would further boost confidence, especially if job market conditions remain strong. Unemployment has remained relatively low despite the economic slowdown.”
“This, in turn, would also be likely to support a modest recovery in housing market activity,” Gardner said. “But any upturn is likely to remain fairly pedestrian, as it will take time for household finances to recover, since average earnings have been failing to keep pace with inflation, and by a wide margin over the last few years.”
While mortgage interest rates are well below the highs seen in the
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