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House prices fell in August
LONDON (Reuters) - House prices fell 0.2 percent on the month in August taking the annual rate of increase to its weakest in more than nine years, the Nationwide building society said on Thursday.
The annual rate of just 2.3 percent was the slowest since May 1996 and took the price of the average home to 157,310 pounds from 158,348 the month before.
House prices edged up a seasonally adjusted 0.2 percent in July, leaving them up 2.6 percent on the year.
The report followed official figures from the Bank of England this week showing the number of mortgage approvals edged up in July to their highest in a year, suggesting that housing market transactions are stabilising.
The BoE cut interest rates for the first time in 2 years in August to 4.5 percent from 4.75 percent, a move which Nationwide said boosted buyer enquiries.
Nationwide said data so far suggested house prices will continue to cool in a contained fashion, echoing many economists who say the once-booming property market is headed for a soft landing rather than a crash.
"However, while market activity seems to have stabilised, this does not signal the start of a further period of sustained growth in house prices," said Fionnuala Earley, group economist at Nationwide.
"Even though wage inflation is almost twice the rate of house price inflation, affordability is still an issue, particularly for first-time buyers, and it will take some time for the balance to be redressed."
House prices were increasing by an annual rate of almost 20 percent or more just a year ago.
News source:
LONDON (Reuters) - House prices fell 0.2 percent on the month in August taking the annual rate of increase to its weakest in more than nine years, the Nationwide building society said on Thursday.
The annual rate of just 2.3 percent was the slowest since May 1996 and took the price of the average home to 157,310 pounds from 158,348 the month before.
House prices edged up a seasonally adjusted 0.2 percent in July, leaving them up 2.6 percent on the year.
The report followed official figures from the Bank of England this week showing the number of mortgage approvals edged up in July to their highest in a year, suggesting that housing market transactions are stabilising.
The BoE cut interest rates for the first time in 2 years in August to 4.5 percent from 4.75 percent, a move which Nationwide said boosted buyer enquiries.
Nationwide said data so far suggested house prices will continue to cool in a contained fashion, echoing many economists who say the once-booming property market is headed for a soft landing rather than a crash.
"However, while market activity seems to have stabilised, this does not signal the start of a further period of sustained growth in house prices," said Fionnuala Earley, group economist at Nationwide.
"Even though wage inflation is almost twice the rate of house price inflation, affordability is still an issue, particularly for first-time buyers, and it will take some time for the balance to be redressed."
House prices were increasing by an annual rate of almost 20 percent or more just a year ago.
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