The housing market is showing signs of resilience, with Nationwide reporting a 0.4% rise in house prices in May compared to April. The average cost of a home now stands at £264,249, marking a 1.3% increase year-on-year. According to Nationwide's index, this rebound follows month-on-month price drops of -0.4% in April and -0.2% in March.
Other lenders have also observed modest falls in recent months, reflecting concerns over subdued demand due to higher mortgage rates. Despite these worries, the recent figures indicate a potential stabilisation in the market.
Inflation fell to 2.3% in April, the lowest level in nearly three years. However, this rate was higher than anticipated by economists and the Bank of England, leading analysts to suggest that an interest rate cut is now less likely in June or August.
Nationwide's chief economist, Robert Gardner, said:
"The market appears to be showing signs of resilience in the face of ongoing affordability pressures following the rise in longer-term interest rates in recent months.
"Consumer confidence has improved noticeably over the last few months, supported by solid wage gains and lower inflation."
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