Ashley Webb, UK economist at Capital Economics, said: “The small fall in the Nationwide house price index in August suggests affordability constraints continue to bite. However, the further drop in interest swap rates over the past month suggests there is scope for mortgage rates to fall further and house price growth to accelerate early next year.”
He said the big picture remained that house prices have gone sideways for the last year and a half and are still 3 per cent lower than the peak reached in the summer of 2022.