House prices to remain ‘flat’ all year, says Nationwide

National housing market will continue moving sideways through the summer months, a new report reveals.

House prices remained flat during June and are likely to continue moving sideways through the summer months, according to a new report.

The three month on three month measure of house prices, which showed a 0.3% rise, was weaker than the 0.6% increase recorded in May, Nationwide said, with prices down 1.1% on June 2010.

Bucking the trend

London continued to flout the norm as the only region to report an annual house price rise, with prices up 2.9% on last year. Northern Ireland remained the weakest region, despite a modest 1.7% bounce back in quarterly growth.

Robert Gardner, Nationwide’s chief economist, said: ‘Stability remained the theme in June. The property market has moved sideways over the past six months, and June’s data suggest that trend is being maintained through the summer months.’

Demand in the housing market meanwhile also remained subdued, with surveyors reporting a ‘still weak’ level of mortgage applications and a ‘sluggish pace’ of new buyer enquiries.

‘There have been a few encouraging developments for households, but to date this hasn’t been enough to reinvigorate the housing market,’ Gardner said.

Looking forward, Nationwide said it expects house prices to remain ‘flattish’ for the remainder of the year.

Nicholas Ayre, director of UK buying agents, Home Fusion, said: ‘It is surely no surprise that the market is as it is, directionless and flat.’

 ‘We have strikes at home, austerity riots abroad, an imploding high street and an economy on its knees,’ he continued. ‘The saving grace of the property market is low interest rates, which look set to remain that way for some time yet, given the disarray of the economy.

Earlier this week Hometrack reported a 0.1% fall in house prices during June, with average prices now 3.9% lower compared with this time last year.