May’s fall is the third drop in house prices over the past four months. Annual growth fell to 2.4%, down from 2.6% in April. The average price of a property in the UK currently stands at £213,618, the building society said.
“Annual house price growth has been confined to a fairly narrow range of circa 2-3% over the past 12 months, suggesting little change in the balance between demand and supply in the market over that period,” said Robert Gardner, Nationwide’s chief economist. “There are few signs of an imminent change. Surveyors continue to report subdued levels of new buyer enquiries, while the supply of properties on the market remains more of a trickle than a torrent.”
Despite the current subdued market, Nationwide still expects prices to rise by 1% this year, although this will depend both on interest rate movements and broader economic conditions. The building society said borrowing costs were likely to remain low.
Separate figures from the Office for National Statistics (ONS) show that on average, house prices have fallen by 0.2% since February this year. The ONS claims that the average price of a property in the UK is currently £224,144, higher than Nationwide’s estimate.
Prices have fallen by 0.9% in the capital since February bringing the average property value in London to £471,944, still more than double the cost of the average UK property.