House prices see summer slowdown, says Nationwide

Annual UK house price growth continued to slow over the summer with homes now 2% more expensive than a year ago, the Nationwide has said.

The building society said that the annual change had fallen from growth of 2.5% in July to 2% in August.

Average property prices had actually fallen by 0.5% in August compared to July, but this is considered to be a much more volatile measure.

The average home now costs £214,745, the Nationwide said.

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Robert Gardner, Nationwide's chief economist, said: "Looking further ahead, much will depend on how broader economic conditions evolve, especially in the labour market, but also with respect to interest rates.

"Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on house price growth and market activity this year, though borrowing costs are likely to remain low."

Jonathan Hopper, managing director of Garrington Property Finders, said: "British holidaymakers weren't the only ones taking a break in August. On this evidence much of the property market was out of action too."