House price growth fell back in February to 2.2%, down from 3.2% in January, the latest house price index from Nationwide has revealed.
Nationwide had reported strong results for the UK housing Market in January – against market expectation and at odds with some other indices.
Overall there was a 0.3% month-on-month fall took the average UK house price to £210,402 – the first time since August 2017 that house prices have fallen month-on-month.
Robert Gardner, Nationwide’s chief economist, said: “After picking up unexpectedly in January, UK house price growth fell back in February, to 2.2% from 3.2% the previous month.
“House prices fell by 0.3% over the month, after taking account of seasonal factors.
“Month-to-month changes can be volatile, but the slowdown is consistent with signs of softening in the household sector in recent months.
“Retail sales were relatively soft over the Christmas period and at the start of the new year, as were key measures of consumer confidence, as the squeeze on household incomes continued to take its toll.”
Meanwhile Jeff Knight, director of marketing at Foundation Home Loans, said the costs of buying a property are still plaguing the sector.
He said: “Despite housing prices dropping slightly, affordability remains a challenge. Many face the likelihood of having to relocate outside the capital for a realistic offer – and given sluggish wage growth and lack of available properties as sellers hold their breath, even that is a challenge.
“Purchasing a property in today’s market can leave many feeling exhausted and disheartened by the process, particularly if they have previous blips on their credit record.
“Providing flexible financial options and a sufficient supply of properties to all those wanting to make the ownership goal a reality is crucial, a top-of-the-list priority across the industry.”
Lucy Pendleton, founder director of independent estate agents James Pendleton, said the results were more in line with what was expected for 2018.
She added: “Cancel that street party, it was just a blip after all. Last month’s optimism has evaporated faster than a snowman on the Equator.
“The January surge looked just as out of place too but Nationwide had already issued its own spoiler alert for this one.
“The firm warned the housing market was slowing earlier this month based on a huge 43% drop in lending at the end of last year.
“If they are right, expect a slow rise, slight fizzle, a gentle landing and no major pop as we move into the second half of the year. House price growth will have to tend to zero at some point if the market is to remain as flat as broadly expected in 2018.”