House prices rise – but Nationwide slaps them down

Thrugelmir

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House prices rise – but Nationwide slaps them down, saying it is third monthly fall in a row

House prices rose last month, Nationwide has reported – although it also reported that they fell, triggering a front page headline in today’s Times, “House price slump triggers fears of new property recession”.

On a non-seasonally adjusted basis, prices stood at an average of £208,711 – up from £207,699 in April – and with a gulf of over £100,000 between Nationwide’s and Rightmove’s latest respective data.

According to Rightmove, asking prices for homes new to the market have continued to rise and now stand at an average £317,281.

Despite the rise which it reported yesterday, Nationwide said that on a seasonally adjusted basis, prices fell – by 0.2%, following a 0.4% drop in April.

Annually, Nationwide said that house price inflation was 2.1% last month, down from 2.6% in April.

Robert Gardner, Nationwide’s chief economist, said: “House prices recorded their third consecutive monthly fall in May – the first time this has occurred since 2009.

“The annual rate of growth slowed to 2.1%, the weakest in almost four years.

“It is still early days, but this provides further evidence that the housing market is losing momentum.

“Moreover, this may be indicative of a wider slowdown in the household sector, though data continues to send mixed signals in this regard.

“While real incomes are again coming under pressure as inflation has overtaken wage growth, the number of people in work has continued to rise at a healthy pace. Indeed, the unemployment rate fell to a 42-year low in the three months to March.

“If history is any guide, the slowdown is unlikely to be linked to election-related uncertainty. Housing market trends have not traditionally been impacted around the time of general elections.

“Rightly or wrongly, for most home buyers, elections are not foremost in their minds while buying or selling their home.”

Gardner said, however, that Nationwide still believes that house prices will go up 2% this year. He did not say whether this would be on a seasonally adjusted basis or not.

http://www.propertyindustryeye.com/house-prices-rise-but-nationwide-slaps-them-down-saying-it-is-third-monthly-fall-in-a-row/

kinger101

What jokers. I bet they weren't writing similar articles saying property prices had actually fell in Nov 15, Jan 16, Sep 16, Oct 16, Nov 16, Jan 17.

Conrad

Prices did over-shoot, I saw massive HPI over the last three or so years, and we need a pause.

I am seeing consistent price reductions now. When sellers come down to the right price they get a sale.

Having said this, I am noticing places such as Harringey still with very busy markets.

As mentioned previously, my experience is Landords are largely not buying now due to big CGT rise, phasing in of income tax rises and the knock on difficulty in obtaining mortgages. The consensus view I get is that they also fear rent caps and other costly measures if Labour wins. BTW I think these will be counter productive from a tenants view.

I am personally buying one but the deposit ended up being quite a bit higher than I hoped and it was an exceptional property so I was prepared to buy regardless.

kinger101

It's a difficult one to call at the moment. On one hand, the median salary to house price levels are similar to the 2007 high. On the other, we saw minor falls at the end of 2010 and throughout 2012 that were short-lived.

It's nice at least that the Nationwide put the election myth to bed.

ReadingTim

I prefer this take on it - mainly for the opening sentence...

padington

Conrad wrote: »

Having said this, I am noticing places such as Harringey still with very busy markets.

It's where the growth in jobs is going to happen, and where there are jobs, there are higher house prices.

Brexit and the choice of amateurish lunch snatching May leadership or Corbyn socialism is however playing heavy on the market.

padington

ReadingTim wrote: »

I prefer this take on it - mainly for the opening sentence...

Yep, looks like I called it right.

kinger101

The Guardian article isn't that useful. We really need to wait and see what the regional Q2 data says when it becomes available. The Halifax data for May is out on Wednesday.

kinger101

Halifax +0.4% MOM, -0.2% Q

westernpromise

kinger101 wrote: »

The Guardian article isn't that useful. We really need to wait and see what the regional Q2 data says when it becomes available. The Halifax data for May is out on Wednesday.

I didn't understand how the buy to let landlord can be the "marginal" buyer of "virtually every new one- or two-bed flat to come on to the market".

If they buy almost every one, they are by definition not the marginal buyer. The marginal buyer is whoever buys the rest.