· Improving affordability helps new and existing buyers

· House prices fell by 1.8% in February

· More cuts in base rate expected

Falling rates reduce existing variable rate borrowers’ typical payments by a third and new buyers see significant improvement in affordability

Commenting on the figures Fionnuala Earley, Nationwide’s Chief Economist, said:

“The price of a typical house fell by a further 1.8% in February, bringing the annual rate of change to -17.6% and the price of a typical house down to £147,746, from £179,358 this time last year. Sharp cuts in interest rates have helped affordability, but have not yet affected housing market confidence sufficiently to boost the levels of new transaction activity or slow the pace of house price falls. Early signs of increased interest in housing, as reported by the pick up in new buyer enquiries, have yet to filter into sales, but do suggest that falling prices and interest rates are raising curiosity now, which could flow through quickly once confidence returns.”

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