Sarah Coles, head of personal finance at AJ Bell, says global turmoil is beginning to take a toll on the UK housing market after Nationwide's House Price Index showed average prices were up just 1.7% year-on-year in May and fell 0.6% month-on-month to £278,024.
In a note, she explained that AJ Bell, one of the UK's largest investment platforms, sees falling consumer confidence, rising unemployment, higher mortgage rates and worries about energy-driven inflation denting buyer enthusiasm and leaving fewer bidders to sustain prices.
Coles pointed out that the Nationwide HPI looks at prices at the point of mortgage approvals, months ahead of Office for National Statistics completion data, and warns sustained weakness will hit downsizers and anyone relying on property for retirement.
“There’s every chance the property market has a tough few months ahead," she added.
