UK house prices fall again in April - Nationwide
UK house prices unexpectedly fell in April for the second month in a row, as borrowing rates went up, according to figures released on Wednesday by Nationwide.
House prices fell 0.4% on the month following a 0.2% decline in March. Economists were expecting a 0.2% increase.
On the year, house price growth slowed to 0.6% in April from 1.6% the month before.
The average house price stood at £261,962 last month, versus £261,142 in March.
Nationwide chief economist Robert Gardner said: "The slowdown likely reflects ongoing affordability pressures, with longer term interest rates rising in recent months, reversing the steep fall seen around the turn of the year.
"House prices are now around 4% below the all-time highs recorded in the summer of 2022, after taking account of seasonal effects."
Imogen Pattison, assistant economist at Capital Economics, said the second consecutive decline in the Nationwide house price index in April confirms that the rise in mortgage rates since the start of the year will prevent further near-term price gains.
"But as we expect Bank Rate to fall more than most expect this year, the drop in mortgage rates further ahead will mean house prices are likely to start rising again," she added.
Pattison said the 0.4% monthly fall reflects the likely tick up in the average quoted mortgage rate from 4.7% in March to 4.8% in April, as higher financial market interest rates maintained upward pressure on mortgage rates.
"In the coming months, we suspect mortgage rates will hover around their April level, keeping demand subdued. We expect that will prevent renewed gains in house prices in the near term. But if we are right to think that Bank Rate will be cut further than most expect this year, mortgage rates should fall to just over 4% by end-2024, leaving house prices up 3% y/y."