House prices fall for third month in a row

Nationwide have revealed that house prices in the UK have fallen for the third month in a row, for the first time since 2009.

The figures suggest that the housing market is losing steam, with the annual growth rate in May dropping to 2.1 per cent - the lowest figure in nearly four years.

Nationwide’s monthly house price index showed that the average price of a home fell by 0.2 per cent between April and May, to £208,711, following monthly declines of 0.4 per cent in April and 0.3 per cent in March.

Robert Gardner, Nationwide’s chief economist, dismissed speculation that housing trends could be affected by the upcoming general election, saying that ‘rightly or wrongly, for most homebuyers, elections are not foremost in their minds while buying or selling their home’.

Gardner was unsure whether the slowdown was a blip, a reflection of the squeeze on household budgets or due to mounting affordability pressures in key areas of the country, but does predict that house prices will slow further as rising inflation further squeezes household budgets.

He said: “It is still early days, but this provides further evidence that the housing market is losing momentum. Moreover, this may be indicative of a wider slowdown in the household sector, though data continues to send mixed signals in this regard.”