UK house price growth faltered in May, with the annual rate slipping to 1.7% from 3.0% the month before, according to the latest Nationwide House Price Index.
Prices fell 0.6% on the month once seasonal effects are stripped out, the first monthly drop of the year, leaving the average home worth £278,024, down slightly from £278,880 in April.
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The conflict in the Middle East is being blamed on economists.
Robert Gardner, Nationwide’s chief economist, pinned the slowdown on the fallout from the conflict in the Middle East, which has pushed up energy prices and market mortgage rates. “Some loss of momentum was to be expected,” he said, pointing to a noticeable knock to consumer confidence since the conflict began. GfK’s confidence gauge tumbled to its weakest level since late 2023 in April and barely recovered in May.
Estate agents are also pointing to soft activity. The Royal Institution of Chartered Surveyors recorded a steep fall in new buyer enquiries in March, the worst reading since 2023, with the measure still firmly in negative territory in April.