UK house prices rise for ninth month in a row

UK house prices rose for a ninth consecutive month in April as the housing market continued to defy an escalating cost of living crisis.

The 0.3% gain marked the longest winning streak since 2016 and lifted the average price of a home to a record £267,620, according to a survey by Nationwide Building Society. Values were 12.1% higher than a year earlier.

The surge has been driven by a shortage of homes for sale and pandemic-driven demand for larger properties away from urban centres. However, Nationwide warned the mounting pressure on consumer spending power, with energy bills soaring and inflation at a 30-year high, is likely to cool the momentum.

“We continue to expect the housing market to slow in the quarters ahead,” Robert Gardner, chief economist at Nationwide, said in a statement. “The squeeze on household incomes is set to intensify.” 

In a sign of potential trouble for the housing market, a Bank of England survey carried out in March found banks planned to significantly scale back mortgage lending amid fears that borrowers could start to default on their debts.

“It’s surprising that conditions have remained so buoyant, given mounting pressure on household budgets which has severely dented consumer confidence,” Mr Gardner said. 

“Consumers’ expectations of their own personal finances over the next 12 months has dropped to levels last seen during the depths of the global financial crisis more than a decade ago.” 

Bloomberg