UK House Prices Show Growth in May, Nationwide Reports

British house prices rose by 0.4% in May, exceeding expectations after two months of decline, according to Nationwide. The market shows resilience despite high borrowing costs, supported by improved consumer confidence and solid wage gains. Analysts predict property prices will rise by 1.8% in 2024, with the upcoming national election expected to have minimal impact.

British house prices rose by 0.4% in May after falling in the previous two months, according to mortgage lender Nationwide.

This increase surpassed economists' expectations of a 0.1% rise.

Compared to May last year, prices were 1.3% higher, exceeding the median forecast of a 0.8% gain.

Robert Gardner, Nationwide's chief economist, noted that the market is showing resilience despite affordability pressures from recent interest rate hikes.

Improved consumer confidence, driven by solid wage gains and lower inflation, has supported this growth.

The housing market slowed in 2023 due to the Bank of England's interest rate increases, but expectations of lower borrowing costs have recently helped revive it.

Analysts expect property prices to rise by 1.8% in 2024 as faster wage growth improves affordability.

Nationwide also mentioned that the upcoming national election on July 4 is unlikely to significantly impact the market, with broader economic trends having a more dominant influence.