UK house prices rise 2.2% in March despite economic uncertainty
House prices picked up in March as the property market gained traction after a slow start to the year, though experts warn the Iran war could 'cloud' this momentum.
The UK's house prices rose by 2.2 per cent year on year in March, up from one per cent growth in the year to February, as prices grew 0.9 per cent month on month, according to Nationwide's house price index.
This house price growth comes among other indications that the property market was strengthening before the Iran war hit market confidence, though experts are split over whether the conflict will make lasting damage.
The Outer South East and East Anglia both saw year-on-year declines in house prices, of 0.7 and 0.4 per cent.
Though London's property market had weakened in recent months house prices in the capital jumped up 1.7 per cent in the year to March, up from 0.7 per cent growth in February.
The capital saw the strongest price growth in the south of England, with the average London house price at £538,181 in the first quarter of this year.
Robert Gardner, Nationwide's chief economist, said: 'The pickup in house price growth suggests that the market had regained momentum after the slowdown recorded around the turn of the year.
However, the sharp rise in global energy prices in response to developments in the Middle East represents a significant shock to the global economy, clouding the outlook.'
Housing activity in the UK has also edged up, with the number of residential transactions six per cent higher in February than January, according to HMRC.
But last month's 102,410 transactions remained six per cent lower than the same time last year, and estate agents Knight Frank said any growing momentum could be scuppered by the Iran war.
Tom Bill, head of UK residential research at Knight Frank, said: 'The recent spike in mortgage rates as a result of the Middle East conflict will have a delayed impact on the housing market as higher rates feed through over the next several months, putting downwards pressure on sales volumes and prices.'
Nathan Emerson, chief executive of estate agent body Propertymark, said: 'It's a positive sign that confidence is returning, but sustained growth will depend on stability in borrowing costs and a consistent flow of motivated buyers entering the market.'
