UK house price correction ‘has some way to go’ after March falls; eurozone and US inflation falls – as it happened

Average UK house prices fell 3.1% in year to March, while energy costs are now falling in the eurozone and US core PCE inflation has dropped

• UK house prices fall at fastest annual rate since 2009
• Eurozone inflation falls sharply as energy prices drop
• UK avoids recession as economy stronger than first thought at end of 2022

The UK housing market may remain weak in the coming months.

Nationwide's chief economist, Robert Gardner, says:

It will be hard for the market to regain much momentum in the near term since consumer confidence remains weak and household budgets remain under pressure from high inflation.

Housing affordability also remains stretched, where mortgage rates remain well above the lows prevailing at this point last year.

March saw a further decline in annual house price growth, with prices down 3.1% compared with the same month last year. March also saw a further monthly price fall (-0.8%) - the seventh in a row - which leaves prices 4.6% below their August peak (after taking account of seasonal effects).

The housing market reached a turning point last year as a result of the financial market turbulence which followed the mini-Budget. Since then, activity has remained subdued - the number of mortgages approved for house purchase remained weak at 43,500 cases in February, almost 40% below the level prevailing a year ago.