LONDON (dpa-AFX) - UK house prices grew at a faster pace in July reflecting steadily improving housing affordability and moderate fall in mortgage rates, Nationwide Building Society said on Friday.
House prices increased 2.4 percent on a yearly basis in July, following June's 2.1 percent increase. Prices were expected to climb at a steady pace of 2.1 percent in July.
On a monthly basis, house prices grew 0.6 percent, in contrast to the 0.9 percent decrease in June.
'Looking through the volatility generated by the end of the stamp duty holiday, activity appears to be holding up well,' Nationwide's Chief Economist Robert Gardner said.
Gardner noted that housing affordability has improved steadily since marked deterioration in housing market during the pandemic. The improvement was driven by a period of strong income growth, more subdued house price growth and a moderate fallback in mortgage rates.
Gardner said underlying conditions for potential home buyers in the UK remain supportive despite wider economic uncertainties in the global economy.
'Unemployment remains low, earnings are still rising at a healthy pace (even after accounting for inflation), household balance sheets are strong and borrowing costs are likely to moderate a little further if Bank Rate is lowered further in the coming quarters as we, and most other analysts, expect,' said Gardner.
Nationwide expects housing market activity to continue to strengthen gradually in the quarters ahead provided the broader economic recovery is maintained.
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