Business

Property market 'moving sideways', says Nationwide

Estate agent
Image caption There has been relatively little activity in the housing market this year

The housing market has "moved sideways" in the past six months, the Nationwide has said, as house prices remained unchanged in June.

The value of the typical home was the same in June as in the previous month, but 1.1% lower than in June 2010, the building society said.

The average UK home cost £168,205, the Nationwide said.

It expects prices to change little during the rest of the year, owing to the economic climate.

Forecast

Prices in the three months to the end of June were 0.3% higher than the previous three months, the figures - based on the building society's own mortgage data - show.

"The property market has moved sideways over the past six months, and June's data suggest that trend is being maintained through the summer months," said Robert Gardner, Nationwide's chief economist.

"It is hard to make the case for prices rising or falling sharply over the remainder of 2011 if the economy develops as we expect.

"Economic growth looks set to gather pace in the months ahead, but is likely to remain unspectacular. This in turn points to only modest gains in employment and sluggish wage increases, which will continue to keep many potential buyers on the sidelines."

He added that expectations of the Bank rate remaining at its historic low of 0.5% meant that there would not be a surge of forced sales.

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