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UK House Prices Inch Up as Mortgage-Rate Jolt Tests Recovery

A brief dip below 6% for 30-year mortgage rates ended after the Iran strikes, raising the risk of delayed rate cuts.

Overview

  • Nationwide reported February prices up 0.3% month on month and 1.0% year on year, placing the average home at £273,176.
  • Chief economist Robert Gardner said the data supports a modest recovery after a late‑2025 dip tied to pre‑Budget tax uncertainty.
  • Across 2025, total transactions rose 10% and first‑time buyer mortgage completions climbed 18%, while buy‑to‑let activity remained subdued versus historic norms.
  • Bank of England figures show the effective rate on newly drawn mortgages eased to 4.09% in January, with purchase approvals slipping to 60,000.
  • After briefly falling to 5.98% in late February, the average 30‑year mortgage rate rebounded to roughly 6.12%, and analysts warned that higher oil prices and inflation risks could stall spring housing momentum as upcoming jobs data and central‑bank decisions set the next moves.