For the first time in over a year, British house prices experienced an annual increase in February, according to the Nationwide Building Society, indicating a resurgence in the housing market following a decrease in mortgage costs. Nationwide reported a 1.2% rise in house prices compared to February 2023, marking the first annual growth since January of the previous year. Additionally, there was a 0.7% increase in house prices from January to February of this year.
According to Nationwide, the price index is now just 3% shy of the record high reached in the summer of 2022, right before the market felt the impact of the Bank of England (BoE) hiking interest rates and the financial instability during Liz Truss’s premiership.
In the three months leading up to February’s end, house prices climbed by 1.2%, the quickest pace since July 2022. Last month, the BoE maintained its key borrowing rate at 5.25%, the highest level since 2008, but mentioned that a rate cut could be on the horizon as inflation moves towards its 2% goal. Mortgage rates have started to fall, anticipating the BoE’s forthcoming actions. The BoE also noted that mortgage approvals in January hit their highest level since October 2022.
