Nationwide said annual growth in UK house prices slowed to 0.5% in October, the weakest rate of expansion for more than two years, as rising mortgage costs discouraged some potential buyers. The lender reported the average price for a property across the UK at £273,566, unchanged from September.
The October figure represented a modest easing from the 0.8% annual increase recorded in the year to September, underscoring a cooling in the housing market that coincides with higher borrowing costs. Nationwide linked the softer performance to the impact of mortgage rate rises on affordability and buyer confidence.
While prices were flat month on month, Nationwide's data point marks a shift from stronger growth earlier in the recovery following the pandemic. Higher financing costs typically reduce the number of transactions and place downward pressure on price growth as some buyers pause plans or seek smaller mortgages.
The lender's report provides a timely gauge of the market as households and lenders continue to adjust to tighter conditions. A slower pace of house price growth can ease immediate affordability pressures for some buyers, but it may also weigh on homeowner equity and related consumer spending if the trend persists.
Further readings and analysis will be needed to see whether this slowdown becomes more pronounced in coming months, particularly if mortgage rates remain elevated. For now, Nationwide's snapshot points to a housing market moving into a more subdued phase after stronger growth earlier in the year.