Annual house price growth in the UK halved last month, as economic uncertainty stemming from the conflict in the Middle East continued to deter homebuyers. According to Nationwide, the average price of a British home rose by 0.8% in the year to September, reaching £274,251. This growth rate was half of the 1.6% recorded in August and marked the slowest pace of home price growth since December of the previous year.
Monthly Decline in House Prices
In addition to the annual slowdown, house prices across the UK fell by 0.2% month on month after accounting for seasonal effects. The housing market has been subdued recently, influenced by the ongoing US-Israel war with Iran and the resulting disruption to Gulf oil flows, which have driven up energy costs and inflation fears.
Rising Mortgage Rates
These economic factors have contributed to higher interest rates on mortgages, making it more expensive for individuals to purchase new homes. Robert Gardner, the chief economist at Nationwide, stated:
