House prices down for third month in a row - first time since 2009

House prices recorded their third consecutive monthly fall in May says the Nationwide.

It's the first time this has occurred since 2009, and the annual rate of growth has now slowed to 2.1 per cent - the weakest in almost four years.

The Nationwide’s chief economist, Robert Gardner, says this is evidence that the housing market is losing momentum as part of a wider slowdown in the economy.

“If history is any guide, the slowdown is unlikely to be linked to election-related uncertainty. Housing market trends have not traditionally been impacted around the time of general elections. Rightly or wrongly, for most home buyers, elections are not foremost in their minds while buying or selling their home” he says.

“Given the ongoing uncertainties around the UK’s future trading arrangements and the upcoming election, the economic outlook is unusually uncertain, and housing market trends will depend crucially on developments in the wider economy.”

He says the Nationwide’s modelling suggests that household spending is likely to slow in the short term as rising inflation increases the squeeze on household budgets. 

“This, together with mounting housing affordability pressures, is likely to exert a drag on activity and house price growth in the quarters ahead” says Gardner; even so, he adds that the likely full-year price growth of homes in 2017 will end up at around 2.0 per cent.

Nationwide says the typical home in the UK now costs £207,699.