Despite the slowing market, house prices are rising

June saw a 1.5% increase in UK property prices over the same month last year, according to Nationwide's house price index.

The average price of a house increased by 0.2% from £264,249 in May to £266,604 last month.

This indicates that home prices are currently 3% lower than the peak values that Nationwide's index reached in the summer of 2022.

Robert Gardner, chief economist of Nationwide, stated, "Housing market activity has been broadly flat over the last year, with the total number of transactions down by around 15% compared with 2019 levels."

Gardner said that the average mortgage rate increased from 1.3% in 2021 to around 4.7% for a first-time buyer with a 25% deposit on a five-year fixed agreement.

The affordability of housing thus remains strained. A borrower making the average wage in the UK today purchasing a typical first-time buyer house with a 20% down payment would have a monthly mortgage payment that is equal to 37% of take-home pay, which is much higher than the long-term average of 30%," he continued.

(Sources: investing.com, proactiveinvestors.co.uk)