30 August 2007There are now "clearer signs" that demand in the housing market has slowed, according to the latest property survey from the Nationwide.
Average UK house prices rose 0.6% in August from July, just above market expectations of a 0.5% gain, it found.
But taken on an annual basis, the Nationwide said house price inflation fell to 9.6% from 9.9% in July, the slowest annual rate since March.
The average price of a UK home now stands at £183,898.
Earlier this month, the Halifax also said that the housing market appeared to be slowing, as did the Land Registry on Wednesday.
But it cautioned that the "dependence of the UK economy on financial services poses a longer term risk" if market turbulence becomes a lasting problem.
The Nationwide added that it still expected house price growth for 2007 as a whole to slow to between 5% and 8%.
It sees three main reasons for this - weaker affordability as house prices continue to grow more quickly than earnings, the effect of higher interest rates and inflation, and thirdly, the expectation of lower prices.
"While it has taken some time for these factors to bite, there are now clearer signs of slower demand in the market reflected in the collapse in new buyer enquiries," said the building society.
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