UK House Price Growth at 11-Month High

The UK Nationwide House Price Index rose 1.7% year-on-year in May 2026, easing from a 3.0% increase in April and marking the softest growth in three months. Compared to April, house prices dropped 0.6%, the first decline in five months, following a 0.4% gain, and exceeding expectations for a 0.1% fall. Nationwide Chief Economist Robert Gardner said the slowdown was partly driven by heightened uncertainty stemming from developments in the Middle East, which pushed up energy prices and market interest rates while weighing on consumer confidence and housing demand. Despite the softer momentum, he noted that the UK economy entered the shock on a stronger footing, supported by solid first-quarter growth and easing inflation. Gardner added that household finances remain relatively healthy, backed by low debt levels, sizable savings buffers and improving affordability, suggesting any housing market weakness could prove temporary if energy prices stabilize and geopolitical tensions ease.

UK house prices rose 3.0% year-on-year in April, marking the fastest pace since May 2025, Nationwide data showed. The latest result topped market expectations and March’s 2.2% gain, with Chief Economist Robert Gardner noting the housing market has regained momentum despite Middle East tensions and higher energy costs. “This is somewhat surprising given that indicators of consumer confidence have weakened noticeably,” he said, adding that higher interest rates and a more uncertain backdrop remain headwinds. On a monthly basis, prices increased 0.4%, easing from a 0.9% gain in March.

The UK Nationwide House Price Index rose 2.2% year-on-year in March 2026, picking up from 1.0% growth in February and marking the fastest increase since last October. On a monthly basis, prices rose 0.9%, above forecasts of a 0.6% gain and accelerating from a 0.3% increase in the previous period. Chief Economist Robert Gardner said the rebound signals improving conditions, but rising global energy prices linked to Middle East tensions pose downside risks. He warned UK growth may slow while inflation could exceed expectations, with markets now pricing in three rate hikes over the next year versus earlier expectations for cuts, pushing up mortgage costs and weighing on affordability and demand. Still, fundamentals remain supportive, with a resilient labor market, low household debt, strong savings, and around 90% of mortgages on fixed rates. Regionally, growth was uneven in Q1, led by Northern Ireland (+9.5%), followed by North West England (+3.3%), while England lagged (+0.9%).