UK house price growth remained muted in February as confidence weakened at the turn of the year yet the relatively healthy economy helped offset Brexit uncertainty, according to new data released on Thursday.
House prices fell 0.1 per cent from the previous month, worse than the 0.2 per cent recorded in January and slightly worse than the flat rate expected from analysts in a Reuters poll, the Nationwide house price index revealed. The annual rate, improved from January, was in line at 0.4 per cent, up from last month’s figure of 0.1 per cent.
“After almost grinding to a complete halt in January, annual house price growth remained subdued in February,” Robert Gardner, Nationwide’s chief economist, said. “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, but survey data suggests that sentiment has softened.”
He added that “measures of consumer confidence weakened around the turn of the year and surveyors reported a further fall in new buyer enquiries over the same period”.
Home ownership rose to 63.5 per cent in 2018 from 62.6 per cent, according to government figures from the English housing survey.
“The wider economic picture remains supportive of house prices,” said Samuel Tombs at Pantheon Macroeconomics, adding that “the resilient labour market is helping to offset the hit from Brexit uncertainty”.
Mr Tombs added that “year-over-year growth in Nationwide’s measure of house prices remained well below last year average rate of 2.1 per cent in February, but we doubt it will sink much lower.”
The number of those who own their house outright has risen by 1.2m people over the past decade as the number remained at a record 7.9m, and almost all are aged 65 or over, Nationwide said.