UK House Price Inflation At 5-month High, But Remains Subdued - Nationwide
May 01 2019 - 12:28AM
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UK house prices rose at the fastest annual pace in five months
in April, but inflation remained subdued, survey data from the
Nationwide housing society showed on Wednesday.
The house price index rose 0.9 percent year-on-year following a
0.7 percent increase in March. Economists had expected the
inflation rate to remain unchanged.
"Indicators of housing market activity, such as the number of
property transactions and the number of mortgages approved for
house purchase, have remained broadly stable in recent months, even
though survey data suggests that sentiment has softened,"
Nationwide's Chief Economist Robert Gardner said.
"Measures of consumer confidence weakened around the turn of the
year and surveyors report that new buyer enquiries have remained
subdued.
House prices rose 0.4 percent month-on-month after a 0.2 percent
increase in March. The pace of growth was the fastest since
November, when prices rose at the same rate.
In contrast, economists had expected the monthly growth in house
prices to slow to 0.1 percent.
"While the number of properties coming onto the market has also
slowed, this doesn't appear to have been enough to prevent a modest
shift in the balance of supply and demand in favor of buyers in
recent months," Gardner said.
"April marks the fifth month in a row in which annual house
price growth has been below 1 percent."
The average price of a UK house rose to GBP 214,920 in April
from GBP 213,102 in March.
Capital Economics said the sluggish house price inflation
reflects the already high level of prices relative to incomes, as
well as the effects of Brexit uncertainty.
"Looking ahead, with Brexit having been delayed until the start
of Q4, housing market conditions are set to stay weak - making a
recovery in housing demand unlikely," Capital Economics Property
Economist Hansen Lu said.
The research firm expects house price inflation to end the year
at around 1 percent and to remain contained at 1.5 percent in 2020
even as the economy and confidence recover.
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