House prices grew by 0.1% in April, according to Nationwide?s latest data. Barring the 0.1% fall in February, the figure is the weakest result since September last year. But the weaker price trend has been attributed to the increasing supply of property coming to the market in March, a trend which might continue for the following months. Fionnuala Earley, Nationwide’s Group Economist, said: ?The rate of growth of house prices cooled sharply in April. Prices increased by only 0.1% in the month, significantly more slowly than the 1.1% increase in March.?
In April last year, house prices grew by 0.7% bringing the annual rate of growth to 4.8% – down from March?s 5.3%. ?While today?s data are clearly not as strong as they have been recently, we would not place too much weight on one month?s result,? said Kelvin Davidson from Capital Economics. ?Indeed, smoothing out some of the monthly variation (by using quarter-on-quarter growth rates) shows that house price growth remains fairly stable at around 2%. The underlying picture remains reasonably healthy as demand conditions have remained quite firm.?
Estate agents are reporting increased levels of supply on their books, according to the Nationwide. RICS supports this, reporting higher levels of new buyer enquiries sales instructions in March and optimism among surveyors about future price rises. ?The weak rise in house prices in April may be nothing more than monthly volatility in a slightly uncertain market,? Mr Davidson added.