Annual house price growth edged higher in August

Average house prices were up 2.4% year-on-year, a slight pickup from the 2.1% recorded in July and the fastest pace since December 2022, according to Nationwide’s latest data.

The lender comments that, provided the economy continues to recover steadily, housing market activity is likely to strengthen gradually as affordability constraints ease through a combination of modestly lower interest rates and earnings outpacing house price growth.

Nationwide’s analysis also suggests that a more energy-efficient property rated A or B attracts a modest premium of 2.8% compared to a similar property rated D, the most common rating. There is little difference for properties rated C or E compared with D.

The Prime London sales market is showing positive sentiment, with activity remaining significantly higher than pre-pandemic levels. The market recorded 34.3% more sales at the start of the summer than during the same time in 2017-2019.