House price growth slows to 1.8% in July, Nationwide finds

Gardner added: “Despite the ongoing risks from the latest energy price shock, the Monetary Policy Committee can take some comfort from the fact that consumer price inflation declined further in June.

“Signs that wage growth has continued to ease gives policymakers more breathing space to assess the extent to which tighter policy is necessary to ensure inflation returns to target.”

Reaction:

Nathan Emerson, CEO at Propertymark:

“Steady house prices reflect a housing market that continues to find balance despite ongoing economic and political change. A combination of constrained housing supply, changing borrowing costs and varying levels of buyer demand continues to influence market conditions, while the national figures mask significant regional variation across the UK. 
 
“Yesterday’s interest rate decision, with rates remaining unchanged, provides greater certainty for borrowers and allows prospective buyers to plan with a clearer understanding of future mortgage costs. 
 
“The next priority should be greater policy certainty. As the new Prime Minister develops his housing agenda, clarity around taxation, housing supply and long-term reforms will help reinforce confidence across the market. Stability in policy is every bit as important as stability in interest rates.” 

Jeremy Leaf, north London estate agent and a former RICS residential chairman:

“After the pick-up in prices last month, it’s interesting but not surprising to note the trend has not been sustained. Buyer power remains so sellers are increasingly obliged to soften prices if they want to maintain transactions.

“This survey has proved to be a particularly accurate long-term identifier of market health as it is linked to customer mortgage offers and recorded on approval.

“The main issue for us now is generating sufficient commitment and momentum while so much uncertainty remains about the likely path of mortgage rates and inflation, partly prompted by the unexpectedly protracted Iran war.

“Looking forward, our offices have recorded a significant uptick in valuation appraisals and buyer registrations so we are anticipating a busy up post-summer holiday period.”

Gareth Lewis, deputy CEO of specialist lender MT Finance:

“Nationwide’s figures reflect a softening housing market. From a lending perspective, we are seeing valuers cautious on value while buyers are looking for a steal and prepared to negotiate hard on price.

“After a strong start to the market this year, we are now seeing the ramifications of an interest rate environment which has become unstable again, and the impact this is having on transactions. Volatile funding rates are the real issue at the moment; while everything pointed towards a lower interest rate environment at the start of this year, the impact of war in the Middle East has since changed this outlook.

“The latest hold in base rate at 3.75 per cent was the right call from the MPC, and this combined with June’s lower inflation figure should help inspire confidence among borrowers and lenders. Andy Burnham and John Healey should be given time to start implementing their economic vision before any changes are made to interest rates.”

Amy Reynolds, head of sales at Richmond estate agency Antony Roberts:

“In our offices, prices remain flat with sensible offers being accepted. There are more sellers than buyers, but sellers aren’t panicking – asking prices are coming down, but a lot of that is simply initial overpricing meeting the time it takes to find the market level. 

“There’s definitely a point where owners simply won’t move at today’s numbers, and we’re seeing that more and more. It’s like a game of chicken – who moves first, the buyer or the seller?”

Mark Harris, chief executive of mortgage broker SPF Private Clients:

“Flat monthly house prices suggest those who are transacting are not willing or able to pay over-the-odds but are taking advantage of this buyers’ market and negotiating accordingly.

“Although some lenders have increased their mortgage rates in recent days, the Bank of England’s steady approach to interest rates, keeping base rate at 3.75 per cent this year, should instill some calm after a period of considerable volatility.

“Borrowers are taking nothing for granted though as the continued high cost of living strains affordability. Many are taking the sensible approach of securing mortgage rates several months in advance of when they need them for peace of mind.”

Jason Tebb, president of OnTheMarket:

“Average property values were flat on a monthly basis as focused, price-sensitive buyers negotiate, while sellers realise they will struggle to sell over-ambitiously priced homes when there is more stock to choose from. 

“Despite the impact of renewed hostilities in the Middle East on inflation and subsequently interest rates, stalling the expected downwards momentum of base rate this year, the resilience of the market is evident. The signs are that the market has steadied itself and buyers and sellers are getting on with it. The Bank of England’s decision to hold interest rates again yesterday for the fifth consecutive meeting is having a steadying effect, suggesting a calm, considered approach with no need to panic. 

“Mortgage rates are edging upwards, which may increase affordability concerns for buyers in the short term but those who need to move are doing so regardless and are just negotiating harder on the price they are prepared to pay. Inactivity isn’t an option for many, even if a new Prime Minister brings another level of uncertainty.

“What we do know is that Andy Burnham is instinctively interventionist and housing is where we will feel it first. For our sector, the likely picture is more regulation on the rental side and a real push on supply that will take years to show up in the numbers.”