Nationwide says it has spotted the first sign of a cooling in the housing market.
It says house prices increased by just 0.3 per cent in January, the lowest monthly rise for eight months. The average price rose from 173,225 to 173,746. Prices increased at an annual rate of 9.3 per cent in January, down from 10.5 per cent in December. It comes after the base rate rose to 5.25 per cent in January.
House prices this year are expected to remain firm in spite despite a further 0.25 per cent rise in rates not being ruled out.
Nationwide chief economist Fionnuala Earley says: “This year started off with a bang as the Bank of England raised interest rates for the third time in six months. Only time will tell how much the surprise decision will affect sentiment in the housing market but even before January’s rate rise, there were already some very early signs of cooling. House prices increased by just 0.3 per cent in January, the smallest mon-thly rise since May last year.”