Nationwide: House Price Growth Remains Subdued In March
House price growth was "subdued" last month as higher mortgage rates affected affordability, the Nationwide has said.
Property prices rose 1.6% on average from March 2023, but fell 0.2% compared with February, the UK's largest building society said.
While mortgage rates have fallen from peaks seen last summer, they remain well above the low levels seen in the wake of the coronavirus pandemic.
The Nationwide said affordability was still stretched, but was improving.
Robert Gardner, the building society's chief economist, told the BBC's Today programme that affordability pressures on buyers was "weighing down" on activity in the housing market and price growth.
For someone on an average wage of about £35,000 per year buying a typical home, mortgage payments currently take up nearly 40% of their take home pay.
"That's well above the 30% which is the long-run average," Mr Gardner said.
In Northern Ireland and the North of England house price growth was stronger than other areas, rising 4.6% and 1.7% respectively compared with last year.
This was mainly due to house prices in those regions being less expensive compared with other places in the UK and more affordable for buyers, leading to higher demand.
The annual house price increase of 1.6% was the fastest rise since December 2022, although it was a smaller increase than economists had been expecting.
Prices fell by 0.2% in March alone, the first drop since December 2023, after a 0.7% increase the month before.