UK house prices dip unexpectedly in March, Nationwide says

House price inflation in the U.K. ebbed unexpectedly last month, the results of a closely followed survey revealed.

According to Nationwide, in seasonally adjusted terms, house prices recorded a month-on-month dip of 0.2% in March (consensus: 0.3%).

Worth noting, in February prices had risen by 0.7%.

Year-on-year on the other hand prices were ahead by 1.6% after a rise of 1.2% in February (consensus: 2.4%).

The average non-seasonally adjusted price meanwhile came in at £261,142, which was down from £260,420 during the month before.

By regions, Northern Ireland paced gains with a 4.6% jump in annual prices, while in the South West they fell by 1.7%.

Nationwide chief economist Robert Gardner said that activity had in fact picked up since the end of 2023, although they remained "subdued" by historical standard.

Mortgage approvals were running 15% below their level from before the pandemic, mostly due to higher interest rates which were still "well above" pre-Covid levels.

He also noted how income growth was continuing to outpace that of house prices by a "healthy margin", consumer sentiment improving and new buyer inquiries and instructions to sell picking up.

"If these trends are maintained, activity is likely to gain momentum, though the pace of the recovery is still likely to be heavily influenced by the trajectory of interest rates."

"The small fall in the Nationwide house price index in March follows two strong months, so it's just a blip," chipped in Pantheon Macroeconomics chief UK economist Rob Wood.

"We continue to expect house prices to rise 4% year-over-year in 2024, broadly in line with the current trend pace of increase in the main house price indices but a little weaker than the rise in nominal wages we expect as affordability is stretched."