01.08.201802:31:00UTC+00UK House Price Inflation Accelerates In July: Nationwide

UK house prices increased at a faster pace in July, data from Nationwide Building Society showed Wednesday.

House prices advanced 2.5 percent year-on-year in July, faster than the 2 percent rise in June. House price growth was forecast to ease to 1.8 percent.

On a monthly basis, house prices gained 0.6 percent, but slightly slower than the 0.7 percent increase seen in June. Economists had forecast only 0.1 percent rise.

"Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low," Robert Gardner, Nationwide's chief economist, said.

"Overall, we continue to expect house prices to rise by around 1 percent over the course of 2018," Gardner.

Providing the economy does not weaken further, the economist said the impact of a further small rise in interest rates on UK households is likely to be modest. Financial market pricing suggests that Bank Rate is only likely to rise to around 1.25 percent over the next five years.