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[LONDON] British house prices rose for a second month in a row in July after falling between March and May, mortgage lender Nationwide said on Tuesday, suggesting a stabilisation in the housing market which has weakened since last year's Brexit vote.
Prices rose 0.3 per cent in July from June, Nationwide said, slower than June's 1.1 per cent jump. Economists polled by Reuters had expected prices to edge down by 0.1 per cent in July.
In annual terms, prices were 2.9 per cent higher, slowing from a rise of 3.1 per cent in June, Nationwide said.
Economists had expected a weaker annual increase of 2.7 per cent.
"On the surface, this appears at odds with recent signs of cooling in the housing market," Robert Gardner, Nationwide's chief economist, said in a statement.
The number of housing transactions dipped to their lowest level for eight months in June when the number of mortgages approved for house purchase sank to a nine-month low.
"But a lack of homes on the market appears to be providing support, with annual house price growth remaining only just outside the 3-6 per cent range, that has been prevailing for most of the past two years," Mr Gardner said.
Although the economy had weakened in early 2017, the shortage of houses on the market would lead to price growth of around 2 per cent in 2017, he said.
House prices, as measured by Nationwide, rose by 5.6 per cent in annual terms in August last year, shortly after by the decision by voters to leave the European Union. Since then, the pace of Britain's economic growth has slowed sharply as consumers felt the pinch of rising inflation.