British house prices rose in May after falling in the previous two months as the property market withstood high borrowing costs, according to figures from mortgage lender Nationwide.
Prices increased by 0.4 per cent from April, the data showed.
Economists polled by Reuters had mostly expected a 0.1 per cent monthly rise.
Compared with May last year, prices were 1.3 per cent higher, a bigger increase than the median forecast in the Reuters poll for a 0.8 per cent gain.
“The market appears to be showing signs of resilience in the face of ongoing affordability pressures following the rise in longer term interest rates in recent months,” Robert Gardner, chief economist at Nationwide, said.
“Consumer confidence has improved noticeably over the last few months, supported by solid wage gains and lower inflation.”
Britain’s housing market slowed in 2023 as the Bank of England pushed interest rates to their highest since 2008. But expectations of lower borrowing costs have helped to push down mortgage rates and revive the market in recent months.
A Reuters poll of housing market analysts published on Thursday showed property prices in Britain were expected to edge up by 1.8 per cent in 2024 as faster growth in wages makes homes more affordable.
Nationwide said the approach of Britain’s national election on July 4 was unlikely to affect the market in the coming weeks, noting that in the past broader economic trends appeared to have dominated immediate election-related impacts.
