House price growth slows more quickly than expected in April, Nationwide says

29th Apr 2022 07:49

(Sharecast News) - House price growth in the UK slowed more than expected in April amid the ongoing squeeze on household incomes and rising interest rates, the results of a closely-followed survey revealed.

According to mortgage lender Nationwide, house prices rose at a month-on-month pace of 0.3%, which marked their slowest clip since September.

In turn, that dragged the annual rate of increase down from 14.3% in March to 12.1% (Consensus: 12.6%).

"Nevertheless, it is surprising that conditions have remained so buoyant, given mounting pressure on household budgets which has severely dented consumer confidence," Nationwide chief economist, Robert Gardner, mused out loud.

Gardner attributed that to the strikingly large proportion of Britons, 38%, who were either moving or planning to do so, as per the results of a separate survey conducted by Nationwide.

That offset the impact on housing demand of consumers' confidence in their personal finances running at near its lows from the Great Financial Crisis, he explained.

UK unemployment back at its pre-pandemic lows and the low level of the stock of homes were also supporting prices, alongside mortgage approvals running at pre-Covid levels.

In non-seasonally adjusted terms, the average price of a home rose from £265,312 in March to £267,620.

Commenting on the outlook, Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said rising two-year fixed rate mortage rates, household real disposable incomes set to fall by 2.5% in 2022 - their steepest pace since 1947 - and extremely weak consumer confidence meant house price growth would likely slow to around 4% by the end of the year.

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