The price of houses dropped for a second consecutive month in April, as property values fell 0.4%.
According to Nationwide Building Society, the fall in prices, which followed the 0.3% drop in March, meant average UK homes now cost £207,699.
The annual rate at which house prices are rising is at its weakest since June 2013, slowing to 2.6%.
It’s noted that the slowdown is due to the squeeze on household incomes and growing affordability pressures.
The standard home is now costing 6.1x the average earnings, which is a lot higher than the long-run average of 4.3x the average earnings and is approaching the all-time high of 6.4x the average earnings back in 2007, just before the house price crash.
During this time, household budgets are coming under increased pressure as wage growth has weakened and inflation has risen.
The housing market’s slowdown could be part of a wider trend, as the growth in retail sales slowed significantly in recent months, falling from its 7.3% 14-year high in October to a lowly 1.7% in March.
Nationwide pointed out that there were significant reservations around the UK’s future due to the Brexit process and June’s General Election.
They also expect household spending to remain sluggish in the upcoming months due to increasing inflation and affordability issues, which is likely to act as a strain on both house prices and activity in the coming quarters.
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