UK house prices increased by an average of 0.5% in April after seven consecutive months of falls, the latest data from Nationwide revealed on Tuesday.

The building society is predicting a “modest recovery” in the housing market as mortgage rates start to come down. But it said any improvement would be relatively modest, as household finances remain under pressure and average earnings have been failing to keep pace with inflation.

The average price of a home rose by 0.5% between March and April to hit £260,441, said the lender, which bases the findings on its mortgage data.

However, that was still 2.7% lower year-on-year.

Industry reactions:

Iain McKenzie, CEO of The Guild of Property Professionals, said: “After a slow start to the year fuelled by the financial challenges households are facing, it appears as though there are now clear signs of vitality in the housing market.

“While affordability remains a huge concern for first time buyers looking to get their feet on the property ladder, it is reassuring to know that their home is not going to lose value after they have signed on the dotted line.

“The threat of an aggressive fall in property sales has failed to materialise and we are starting to see more mortgage applications being approved meaning that buyers can get planning their next move.

“Estate agents have been using these past few months to expand their stock so that they can offer buyers a greater variety of properties to choose from.”

Matt Thompson, head of sales at Chestertons, said: “Savvy house hunters used the Easter holidays to continue their search online and enquire about properties to arrange a viewing as soon as possible. April has therefore been a busy month; particularly as buyers are a lot more aware of today’s competitive market conditions. As a result, most buyers have also been preparing their paperwork as much as they could in order to make an offer and secure a property before the summer.”

Jason Tebb, CEO of OnTheMarket, commented: “Annual house price growth declined again in April although there was a slight improvement on March, further suggesting that the recalibration of the market continues in a calm, measured way.

“More stock is becoming available as the typically busier spring months start to encourage more sellers to come to market, providing buyers with increased choice more akin to pre-pandemic conditions. This, combined with tighter budgets as a result of consecutive interest rate rises and the high cost of living, means that buyers are less willing or able to pay inflated property prices.

“While there is more optimism in evidence with regard to the future movement of both interest rates and inflation, sellers must still price correctly and sensibly in order to achieve a successful outcome.”

Jeremy Leaf, north London estate agent, remarked: “This generally reliable survey, though only based on Nationwide’s own customers’ experiences, reveals house prices are holding up well despite continuing worries about mortgages and inflation.

“Not only are lenders being cautious, buyers are also ensuring they have sufficient resources, not only to cover repayment, improvement and other costs, as well as getting the best property deal they can before taking the plunge.”

Nathan Emerson, CEO of Propertymark, commented: “Our member agents are reporting transaction levels year on year to be stable as a stream of new properties enter the market with serious buyers still keen to move.

“Sellers are still in a strong position to sell; however, they can no longer test the market at higher prices and align with those achieved last year. Instead, they will need to reduce or be open to offers for a more realistic and efficient sale.”