Nationwide house prices suffer first annual fall since 2012

HOUSE prices fell sharply for the second month running in June as the impact of the economic slump triggered by lockdown began to feed through to the property market.

Lender Nationwide said the outlook for prices remains “highly uncertain” as it revealed that the average value of a home dipped 1.4 per cent in June. This follows a 1.7 per cent drop in May. They are the biggest monthly declines since the financial crisis in 2009.

The consecutive falls means that prices are 0.1 per cent lower than a year ago across the country as a whole, the first annual fall since 2012.

However, property analysts said that while the figures were “bad, perhaps very bad” there were few signs yet of a full-scale collapse such as that seen during the banking crisis or the early Nineties recession. Nationwide’s chief economist Robert Gardner said: “It is unsurprising that annual house price growth has stalled. Economic output fell by an unprecedented 25 per cent over the course of March and April — almost four times more than during the entire financial crisis.

“With the lockdown due to be eased, housing market activity is likely to edge higher in the near term, albeit remaining below pre-pandemic levels.

“Nevertheless, the medium-term outlook for the housing market remains highly uncertain.”

Andrew Montlake, managing director at the UK-wide mortgage broker, Coreco, said: “The June house price data is bad, perhaps very bad, but it was always on the cards.

“The hope is that the buoyant economic support package put in place by the Government will help the market to resurface quickly.”