Average UK house prices had fallen for seven months in a row before April’s slight increase

The UK housing market has shown tentative signs of recovery, as the average house price rose by 0.5% in April, following a prolonged decline of seven consecutive months. This increase, though modest, has sparked cautious optimism in the housing sector, with analysts suggesting it could indicate a potential rebound. Despite the rise, annual house price growth remains negative, with prices still 2.7% lower than the same time last year.

Nationwide Building Society, which compiled the data, pointed to the April increase as a positive sign, though they caution that prices are still significantly lower than the peak levels seen in August 2022. The chief economist at Nationwide, Robert Gardner, noted that housing market activity remains subdued, with mortgage approvals down nearly 40% from a year ago. However, recent data from the mortgage industry suggests a potential pick-up in activity, which could further support a modest recovery later in the year, particularly if inflation falls and the job market remains stable.

Experts in the housing sector, such as Nathan Emerson from Propertymark and Tom Bill from Knight Frank, highlighted that the market is seeing more stable conditions after the turbulence caused by last year’s mini-budget. Sellers are advised to adjust their expectations, as prices have become more realistic compared to last year’s highs. Despite the overall challenges, the market appears to be stabilizing with more stock becoming available and a growing sense of confidence, even though buyers are still cautious due to high mortgage rates and living costs.

While some economists, like Samuel Tombs of Pantheon Macroeconomics, believe the price increase may be short-lived, others, such as Jonathan Hopper from Garrington Property Finders, point out that this could be a sign of the market bottoming out. Despite continued volatility, the boost in activity is encouraging and may signal the beginning of a more stable housing market in the months to come.