United Kingdom. New data from the real estate market
House prices in the United Kingdom fell by 0,6% on a monthly basis for the first time this year, according to Nationwide data.
For comparison, in April apartments rose by 0.4%.
On an annual basis, house prices increased by 1,7%, slowing from the 3% recorded a month earlier.
“One would expect some weakening of the dynamics, given the uncertainty caused by events in the Middle East and the resulting rise in energy prices and market interest rates,” said Robert Gardner, chief economist at Nationwide.
“Indeed, consumer confidence has clearly fallen since the start of the conflict – the main GfK indicator dropped in April to its lowest level since the end of 2023, and in May only a slight increase was recorded,” he added.
As experts point out, the stalemate in negotiations between the United States and Iran has contributed to worsening sentiment in real estate markets, including in the United Kingdom.
The UK house price index, developed by The Royal Institution of Chartered Surveyors (RICS), indicated that the number of real estate agents reporting falling prices clearly exceeded those reporting increases.
Fewer homeowners are also choosing to list their properties for sale, which could lead to a slowing of the influx of new offers to the market.
We wrote more about this in the article: The real estate market is stalling. Such a collapse has not been seen for almost 3 years
Source: Nationwide.
Read also: The real estate market is cracking. “The year 2026 looks like a good time to buy a flat”
See also: Harsh data from the real estate market. Flat sales suddenly fell by almost 20%
The Middle East dictates trends in the housing market
The Nationwide report shows that the UK economy recorded solid growth of 0,6% in the first quarter, and inflation fell in April more than expected.
“Nevertheless, this year economic growth will probably be somewhat weaker, and inflation higher than previously forecast due to events in the Middle East, although the ultimate impact will depend on the duration of the crisis and political reaction,” the report said.
As highlighted, both the UK economy and the real estate market have shown “unusual resilience” in recent years.
“The financial situation of households is stable. Total household debt relative to income is the lowest in about two decades, and significant savings reserves have also been accumulated, although they are not evenly distributed among households,” the report reads.
“Moreover, in recent years housing availability on the market has gradually improved thanks to a combination of two factors: income growth far outpacing property price growth and a slight decline in credit costs,” it added.
Experts say that with the normalization of energy prices in the coming quarters, the short-term weakening in the real estate market will be offset.
Chart. Office for National Statistics estimates of UK economic growth in the first quarter of 2026
Source: Office for National Statistics.
Read also: The real estate market is stalling. Those looking for a flat “should know this” - experts say
See also: Real estate is no longer falling. In a month 40 thousand sales contracts were cancelled, flats are stuck on the market for 60 days
Sources: Nationwide, The Royal Institution of Chartered Surveyors, Office for National Statistics.
