Annual house price growth continues to soften

February House Price Index

The pace of annual house price growth continued to soften in February, down to 5.7% from 6.8% in January. This is the sixth month in a row in which annual growth has moderated, with house prices declining by 0.1% month on month.

Robert Gardner, Nationwide’s Chief Economist, commented “The broader economic backdrop has remained supportive of housing market activity. Mortgage rates remain close to all-time lows and consumer confidence remains buoyant thanks to a further steady improvement in labour market conditions. Indeed, the unemployment rate has continued to decline and earnings growth has picked up, particularly in inflation-adjusted terms, thanks in part to the sharp decline in energy prices.

“Nevertheless, the pace of housing market activity remains fairly subdued. There was a small increase in the number of mortgages approved for house purchase in December, up 2% from 59,000 in November to 60,300 in December, though it remains too early to determine whether this marks a turning point in activity”.

Headlines Feb 2015 Jan 2015
Monthly Index* 380.1 380.5
Monthly Change* -0.1% 0.3%
Annual Change 5.7% 6.8%
Average Price (not seasonally adjusted) £187,964 £188,446
*Seasonally adjusted figure (note that monthly % changes are revised when seasonal adjustment factors are re-estimated)

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