House price growth 'subdued' in June: Nationwide

Dropping to the slowest pace since February, house prices rose by just 0.5% during the month, compared with the same period last year.

This marked the seventh consecutive month it has been below 1%.

Robert Gardner, Nationwide's Chief Economist, said:

“UK annual house price growth remained below 1% for the seventh consecutive month in June, at 0.5%.

“Survey data suggests that new buyer enquiries and consumer confidence have remained subdued in recent months. Nevertheless, indicators of housing market activity, such as the number of mortgages approved for house purchase, have remained broadly stable.

“Housing market trends are likely to continue to mirror developments in the broader economy. While healthy labour market conditions and low borrowing costs will provide underlying support, uncertainty is likely to continue to act as a drag on sentiment and activity, with price growth and transaction levels remaining close to current levels over the coming months."

Tomer Aboody, director of property lender MT Finance, says:

"The fact that the market is subdued is not surprising as the summer tends to be quieter for the property sector.

"However, once a decision is made by the Conservative Party as to whether it is Boris or Jeremy for prime minister, this will give the market a boost and stimulate the economy. Both candidates have set out encouraging plans for the housing market with regards to stamp duty and taxation cuts, and these will appeal to many.

"The London property market is very interesting as people have been down on the capital for some time, talking about falling prices, but in actual fact they haven’t fallen by very much and are only an astonishing 5 per cent off the 2017 high. It shows that people in the capital are still buying but there are fewer of them, which is affecting prices. Many people don’t have to sell and that is reflected in the figures."

Lucy Pendleton, founder director of independent estate agents James Pendleton, said:

“London has stabilised dramatically with a remarkable bounce back from pretty dire quarterly growth figures earlier in the year.

“On the doorstep, it was clear the capital's buyers shot back into the swing of things as soon as Britain’s first set of Brexit goal posts came and went in March without incident.

“The strong way London rebounded is also testament to the fact the capital remains a very special case because there is so much pent up demand. Buyers there are highly sensitive to price falls and you don’t need to go far to find buyers, unlike in the regions.

“Nationally, it’s no coincidence that this is the seventh consecutive month of sub-1% annual growth on the third anniversary of the Brexit vote. Growth has been slowing steadily ever since the summer of 2016 as political upset has trimmed people’s risk appetite.

“The Bank of England has predicted second quarter economic growth to be zero and, for all the talk of a healthy labour market and low borrowing costs, weak growth in the property market still mirrors that overall. The broad brush stroke of the UK property market seems to be slipping
inexorably towards zero growth too right now.”