House prices have fallen further in May says Nationwide Building Society.

House prices in the UK have had their biggest monthly fall in the last 17 years, according to the Nationwide Building Society.

Dropping by 2.5% during May, prices are now 4% lower than a year ago, a drop of £8,000 which has taken the average UK house price down to £173,583.

Fionnuala Earley, Nationwide’s Chief Economist, said: “The pace of house price falls accelerated in May as more weak economic news added to the gathering momentum of negative sentiment about the housing market.”

May’s fall of 2.5% is, in fact, the largest recorded monthly fall in the history of the Nationwide monthly index – which started in 1991. 

At seven months, this is also the longest consecutive period of monthly falls since 1992.

Earley continued: “However, the strength of house price growth up until last year means that prices are still 5% higher than two years ago and 10% higher than three years ago.”

She also suggested that today’s borrowers are better placed to weather the storm than in the recession of the 1990s. “First, fewer homeowners bought at the top of the market in this cycle…Secondly, today’s borrowers have typically put down a larger deposit than their 1980s counterparts.”

“Thirdly, a much greater proportion of today’s borrowers have opted to repay capital rather than just interest,” she added. 

For more information on the monthly survey, visit: www.nationwide.co.uk