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House price growth under 1% for eighth consecutive month

House prices in the UK have increased 0.3 per cent on both a yearly and monthly basis, according to data collected by Nationwide.

As of July 2019, the average house price stands at £217,663, up from £216,515 seen in June.

Nationwide adds that annual house price growth remained below 1 per cent for the eighth month in a row.

Nationwide chief economist Robert Gardner says that surveyors have reported new buyer enquires have increased, though key consumer confidence indicators remain subdued.

However, despite a slow down in transaction activity, he adds that the number of mortgages approved for purchase has remained stable.

Gardner says: “Housing market trends will remain heavily dependent on developments in the broader economy.

“In the near term, healthy labour market conditions and low borrowing costs will provide underlying support, though uncertainty is likely to continue to exert a drag on sentiment and activity.

“Taking a longer-term view, housing market activity has been broadly stable in recent years, with the number of properties changing hands equal to around 5 per cent of the total number of homes in the UK.

“This turnover rate is significantly higher than the lows seen in 2009 but is still well below the rates of 8 per cent seen pre-crisis.

“One of the key factors behind the low turnover rate is the continued weakness in home mover activity, which is still less than half the levels prevailing in 2007.”

Mortgage Advice Bureau head of lending Brian Murphy comments: “It would appear that whilst average house price growth has been modest during July, the figures do at least indicate a level of positive change both month-on-month and year-on-year.

Murphy says that while these figures are not “earth shattering”, it suggests that this is an indication of continued market resilience.

He adds: “Looking at the rest of the report, it is interesting to see that the Nationwide suggests a gradual change in home mover behaviour over the past five years or so, with people moving less frequently than they did pre 2007.

“The positive news, however, is that the Nationwide data indicates that first-time buyers are now returning and are almost at parity with the numbers seen over a decade ago.”

Housesimple estate agent Sam Mitchell believes that despite the “subdued growth”, seeing growth at all demonstrates the strength and stability of the property market “against a backdrop of political and macro uncertainty seen in recent months.”

He says that it is “very encouraging pockets of positivity are emerging for the first-time buyer market too, where we are seeing the figures finally return almost to pre-crisis level.

“With a new occupier in at Number 10 it will be interesting to see what changes lie ahead to support buyers and sellers.

“Whatever changes are made, the new PM needs to act quickly to avoid uncertainty, which could leave buyers and sellers alike sitting on their hands anticipating a change.”

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