UK Nationwide house price index which was published Thursday morning showed that the annual rate of increase slowed at the start of Q2. According to the Nationwide Building Society, the annual pace of house price growth slowed to 4.9% in April, compared with 5.7% in the previous month. After three years of double-digit rises, London house price growth is beginning to slow.
House prices rose by just 0.2% in April, the lowest monthly increase since last November. A rush to beat a rise in stamp duty from April 1st probably saw record high number of property sales in March. There were 165,400 transactions during March, higher than the previous peak of 149,000 in January 2007.
"It may be that the surge in house purchase activity resulting from the increase in stamp duty on second homes from 1 April provided a temporary boost to prices in March," said Robert Gardner, Nationwide's chief economist.
While the increase in March was likely flattered by a surge in activity ahead of the increase in the stamp duty on second homes from April, Brexit uncertainty is likely to result in a further softening of UK house price growth over the near term. Nationwide however did not mention the risk of Brexit as an influence on house prices.
"Current increased domestic economic and political uncertainties could also be reining in housing market activity, especially in the run-up to June's EU referendum," said Howard Archer, economist at IHS Global Insight.
