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UK house prices rose more than expected in May, supported by low unemployment and strong wage growth, the lender Nationwide said.
The average cost of a property rose 0.5 per cent between April and May to £273,427, mostly reversing the 0.6 per cent fall in the previous month, showed data released on Monday.
Prices rose at an annual rate of 3.5 per cent, up from 3.4 per cent in the previous month. Both are stronger than the 0.1 per cent month-on-month increase and the 2.9 per cent annual rise forecast by economists polled by LSEG.
Robert Gardner, Nationwide’s chief economist, said: “Despite wider economic uncertainties in the global economy, underlying conditions for potential home buyers in the UK remain supportive.”
He added: “Unemployment remains low, earnings are rising at a healthy pace, household balance sheets are strong and borrowing costs are likely to moderate a little if the bank rate is lowered further in the coming quarters as we, and most other analysts, expect.”
Gardner noted that activity appeared to be holding up well following the end of the stamp duty holiday.
From April 1, the stamp duty thresholds reverted to pre-2022 levels, increasing the tax cost for many property buyers.
First-time buyers, for example, will pay the levy for properties worth £300,000 or more, instead of the previous £425,000.
