The big 0.8% m/m fall in Nationwide house prices in June suggests that the housing market is still struggling to recover from both the stamp duty-induced lull and the weak economy. While some leading indicators suggest that a turnaround in the housing market is underway, it probably won’t happen fast enough to meet our existing forecast for house prices to rise by 3.5% in the year to Q4 2025. But our new forecast that Bank Rate will fall from 4.25% now to 3.00% next year (3.50% previously) suggests lower mortgage rates may boost house prices by more than we expect in 2026.
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