UK house prices dip unexpectedly in May, Nationwide says

House prices in the UK dipped unexpectedly in May as a result of the uncertain economic environment, although activity in the housing market was "broadly stable", mirroring the broader trends in the economy, the results of a closely-followed survey revealed.

Mortgage lender Nationwide's home price index slipped by 0.2% month-on-month in May, dragging the year-on-year rate of home price appreciation from 0.9% for April to 0.6%.

In non-seasonally adjusted terms, the average price of a home edged higher from £214,920 to £214,946.

Although survey data suggested that new buyer enquiries and consumer confidence remained subdued, activity indicators for the housing market, such as the number of property transactions and of mortgages approved for house purchase had remained "broadly stable", Gardner said.

"Housing market trends are likely to continue to mirror developments in the broader economy," he added.

Gardner also pointed out that May constituted the six consecutive month of house price gains below 1.0%.

Healthy labour market conditions and low mortgage costs would likely offset uncertainty over coming months, with price increases and transaction levels remaining close to current levels.

Nevertheless, outside of London and the South East, prospective first time buyers continued to find it difficult to raise a deposit.

And in the capital, unlike in most of the UK, rapid price growth in the three years to 2015 meant that monthly mortgage payments had simply become unaffordable for much of the local population.