The price of a typical house rose by 1.2% in May, providing further evidence of some improvement in housing market conditions over the last few months.
“At £154,016, the average house price is still 11.3% lower than a year ago, although this marks a significant improvement from the annual decline of 15.0% recorded in April,” commented Martin Gahbauer, Nationwide’s Chief Economist.

“The 3 month on 3 month rate of change - a smoother indicator of short-term price trends - rose from -3.0% in April to -0.5% in May and now stands at its highest level since January 2008.”

The Royal Institute of Chartered Surveyors (RICS) confirmed that the Nationwide figures appear to correspond with their own data.

Simon Rubinsohn, RICS chief economist believes that the figures are consistent with the recent trend in the RICS sales-to-stock ratio which has now risen for four consecutive months; historically a good lead indicator of turning points in house price inflation.

“The lack of new supply of houses coming onto the market is a key driver for the current turnaround in prices,” he said.

“The RICS new instructions series (part of the RICS monthly Housing Markey Survey) has fallen consistently for the past two years as would-be vendors have either turned to the rental market or decided to stay put rather than attempt to move in, what has been, a particularly challenging environment.

This has left estate agents with little fresh stock to offer potential purchasers who have flocked to the market in recent months. Even though house prices do appear to be rising in some particularly desirable locations at the present time, it would be premature to assume a more general reversal of the slide in house prices in the near term."

Better Money Advice - Bringing you the best money saving deals on 2-4-1 restaurant vouchers, plus the best money advice. Best Loan Deals, Best Insurance Deals, Credit Card Deals & more Money Saving Deals Online- Bettermoneyadvice.co.uk.

Not what you are looking for? Search Better Money Advice for the Latest Money Saving Deals & News