United Kingdom: Housing market continues to look fragile in May
May 31, 2019
According to the Nationwide Building Society (NBS), house prices in the United Kingdom fell 0.2% in May compared to the previous month in seasonally adjusted terms, contrasting April’s revised 0.3% increase (previously reported: +0.4% mom). On an annual basis, house prices rose 0.6% in May, down from April’s 0.9% increase. The average house price in May was GBP 214,946 (May 2018: GBP 213,618). Ongoing weakness in the housing market is likely linked to limp consumer confidence and intense Brexit uncertainty causing households to delay home purchases.
Going forward, house prices are likely to continue to rise slightly in annual terms, supported by a strong labor market, still-low borrowing costs and the government’s Help To Buy scheme. However, Brexit uncertainty will likely continue to dampen market activity.
Author: Oliver Reynolds, Economist