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UK annual house price growth softened in August as affordability concerns continue to weigh on buyers, data from Nationwide showed on Monday. The Nationwide house price index showed a 0.1% monthly decline in seasonally adjusted UK house prices in August, weakening from 0.5% growth a month earlier. This underperformed against an FXStreet-cited consensus of 0.2% growth. In August, the average non-seasonally adjusted UK house price stood at £271,079, falling from £272,664 in July. Annually, the house price index rose by 2.1%, slowing from 2.4% growth a month earlier. ‘The relatively subdued pace of house price growth is perhaps understandable, given that affordability remains stretched relative to long-term norms. House prices are still high compared to household incomes, making raising a deposit challenging for prospective buyers, especially given the intense cost of living pressures in recent years,’ said Robert Gardner, chief economist at Nationwide. Gardner continued: ‘However, affordability should continue to improve gradually if income growth continues to outpace house price growth as we expect. Borrowing costs are likely to moderate a little further if bank rate is lowered again in the coming quarters. This should support buyer demand, especially since household balance sheets are strong and labour market conditions are expected to remain solid.’ Nationwide added that 53% of owner-occupied properties in England are classified as ‘underoccupied’, meaning they have two or more spare bedrooms. Copyright 2025 Alliance News Ltd. All Rights Reserved
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