New figures release by Nationwide have revealed that the property market is stable at the moment, with a modest growth in July of just 0.3% month-on-month. This little increase results in annual house price growth of 2.9%.
“The annual pace of house price growth remained broadly stable in July at 2.9%, only a touch lower than the 3.1% recorded in June,” commented Robert Gardner, Nationwide’s chief economist. “On the surface, this appears at odds with recent signs of cooling in the housing market. The number of housing transactions dipped to their lowest level for eight months in June, while in the same month the number of mortgages approved for house purchase moderated to a nine-month low of c.65,000.”
However, he continued on to say that a lack of homes on the market appears to be providing support, with annual house price growth remaining only just outside the 3-6% range, that has been prevailing for most of the past two years.
“Ultimately, housing market developments will depend on wider economic performance,” he added. “The UK economy slowed noticeably in the first half of the year and there has been little to suggest a significant departure from recent trends in the quarters ahead. While employment growth has remained relatively robust, household budgets are coming under pressure as wage growth is failing to keep up with the rising cost of living.”
This suggests that housing market activity is likely to remain subdued, with the balance in the market shifting a little further towards buyers in the quarters ahead.