British house prices saw the biggest monthly drop since June 2020 with a fall of 1.4% in November compared to the month before, which is the clearest sign yet that the housing market is cooling rapidly, data from Nationwide showed on Thursday.
A Reuters poll of economists had pointed to a fall of 0.3%, following a 0.9% drop in October.
In annual terms, house price growth slowed to 4.4% in November from 7.2% in October, mortgage lender Nationwide said.
Other gauges of house prices have also pointed to a slowdown underway.
Nationwide said the fallout from the September economic agenda of former Prime Minister Liz Truss – which triggered a collapse in British financial assets, amplified by the structure of the pension industry – continued to reverberate through the housing market.
"While financial market conditions have stabilized, interest rates for new mortgages remain elevated and the market has lost a significant degree of momentum," Nationwide chief economist Robert Gardner said.
He said the market was likely to remain subdued in the coming quarters, although a "relatively soft landing" was possible, thanks to the strength of the labor market and weak supply of homes coming to the market.
A Reuters poll of economists and property market analysts last week placed the forecast that house prices would drop around 5% next year, having risen about 24% since early 2020, according to official data.
