Data published by Nationwide Building Society showed that housing prices fell by 0.2% in August, partially offsetting the July increase (+0.3%). Economists expected prices to increase by 0.2%. This was the first price decline in the last 4 months.
In annual terms, house prices rose by 2.4% (the strongest pace since December 2022) after an increase by 2.1% in July. This was the seventh increase in a row. Consensus estimates suggested an increase by 2.9%. As a result, the average price of a typical home (not seasonally adjusted) was 265,375 pounds compared to 266,334 pounds in July. Nationwide said that house prices are now around 3% below the all-time highs recorded in the summer of 2022, after taking account of seasonal effects.
““While house price growth and activity remain subdued by historic standards, they nevertheless present a picture of resilience in the context of the higher interest rate environment and where house prices remain high relative to average earnings. Providing the economy continues to recover steadily, as we expect, housing market activity is likely to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth," said Robert Gardner, Nationwide's Chief Economist.