Annual house price growth in the UK has slowed to its weakest pace since January 2024, according to Nationwide Building Society.
Nationwide reported that property values grew by 0.5% in October, down from 0.8% in September. On a month-on-month basis, prices remained unchanged, with the average UK property standing at £273,566 in October.
Rising Mortgage Costs and Economic Uncertainty
Robert Gardner, Nationwide’s chief economist, said the slowdown reflects rising mortgage costs driven by expectations of upcoming interest rate increases as policymakers aim to cool inflation caused by the Iran war.
Gardner said: “Market activity and house price growth have slowed in recent months, in part reflecting the uncertain economic backdrop.”
He added: “Geopolitical tensions remain high, with the conflict in the Middle East exerting upward pressure on energy prices, fanning inflation concerns.”
Market Outlook and Consumer Sentiment
Gardner noted that the property market is expected to remain under pressure but should recover once the energy price shock fades.
He said: “Forward-looking indicators suggest further softness in the near term. Surveyors report that new buyer inquiries remain weak. Moreover, consumer sentiment dipped noticeably in October, with households becoming less confident about the outlook for the general economy as well as their own financial situation in the year ahead.”
He concluded: “Once the energy shock fades, there are good reasons to believe the market will regain momentum.”
