The latest data from Nationwide’s House Price Index revealed a 0.9% rise in the year to April, and a 0.4% increase during the month. It means the average UK property price is currently £214,920 – a slight uplift on March’s £213,102.
Robert Gardner, Nationwide’s chief economist, labelled April’s growth as ‘subdued’ and pointed out this was the fifth month in a row that house prices had increased by less than 1%.
He said the factors used to measure housing market activity such as the number of property transactions and mortgages approved, had remained ‘stable’ in recent months
Opportunities for first-time buyers
However, he also highlighted the opportunities the recent market conditions had presented for first-time buyers.
“While house prices remain high relative to average earnings, low mortgage rates have helped to support mortgage affordability,” he said.
“Indeed, raising a deposit appears to be the major barrier for prospective first-time buyers, since the cost the servicing the typical mortgage remains in line with our below long-run averages as a share of take home pay in most regions of the UK.”
He explained this was not the case in London and parts of the South East where affordability was more of a problem.
Gareth Lewis, commercial director of property lender MT Finance, said while it was hard to see this ‘suppressed growth’ changing in the foreseeable future, the fact there was any growth at all was encouraging considering the wider political arena.
Meanwhile, Dilpreet Bhagrath, mortgage expert at online broker, Trussle, said subdued house prices and the narrowing gap between wages and prices meant the prospect of homeownership might feel more attainable to many.
“While not ideal for current sellers, this slowdown opens a window for first-time buyers who already have a deposit saved up,” she said.
“However, for many, saving for a deposit is no easy task. More than two in five (41%) parents admit to still having grown-up children living at home, highlighting the financial struggles facing young people as they attempt to get a foot on the property ladder.”
