UK house prices rebound, Nationwide says

UK house prices bounced back in June after three months of falls, according to mortgage lender Nationwide.

House prices rose by 1.1% during the month after falling by 0.2% in May.

But Nationwide economist Robert Gardner warned that "monthly growth rates can be volatile, even after accounting for seasonal effects".

The average price of a house in the UK rose by £2,590 to £211,301. Annual house price growth edged up to 3.1% from 2.1% in May

London house prices rose at the slowest annual pace since 2012, by 1.2% year-on-year.

Mr Gardner said: "There has been a shift in regional house price trends. Price growth in the south of England has moderated, converging with the rates prevailing in the rest of the country."

He added that in the second quarter of the year, the gap in percentage rises between the strongest performing region - East Anglia, which saw 5% annual growth - and the weakest - the North of England, with 1% growth - was the smallest on record.

"Nevertheless, when viewed in levels, the price gap between regions remains extremely wide," Mr Gardner said.

However he also pointed out that London saw a "particularly marked slowdown, with annual price growth moderating to just 1.2% - the second slowest pace of the 13 UK regions".

Commentators said that the regional shifts were significant.

Jonathan Hopper, managing director of Garrington Property Finders, said: "For London's house prices to be growing at the second slowest rate in the country would have been unthinkable for much of the past decade.

"Instead, growth is now spread much more evenly across the country, with the market fragmenting into a patchwork of smaller hotspots and coldspots."

Meanwhile, Nationwide said that the rising cost of living would curtail household spending which, in turn, would create a "drag" on activity in the housing market.

A lack of homes being built, and few properties being put up for sale, meant house prices would still rise by 2% this year, the building society forecast.