Britain's housing market saw a modest increase in August, with house prices edging up by 0.2%. This comes as uncertainty surrounding interest rates and the broader economic outlook continues to affect activity.
Nationwide's latest House Price Index indicates that annual house price growth held steady at 1.6%. The figures emerge amidst renewed uncertainty for those involved in the property market, following volatility in expectations for the future path of the Bank Rate.
Higher energy prices have contributed to inflation concerns. However, Nationwide stated there are indications that the latest energy price shock is not significantly impacting underlying price pressures. The lender also highlighted a further easing in private sector wage growth, which could offer Bank of England policymakers more scope to assess future monetary policy.
Despite the subdued market, Nationwide believes that underlying affordability is gradually improving. House price growth continues to run well below earnings growth, which helps prospective buyers, although this benefit has been partially offset by higher mortgage rates.