British house prices rose only modestly for a second straight month in May, the Nationwide Building Society said this morning, warning that accelerating growth in property prices should not be taken for granted.
The 0.2% monthly rise in May, which followed a 0.1% gain in April, cast some doubt on the recent strength in the property market, which most other surveys have attributed to a revival based mainly in London.
Nationwide's figures stand in sharp contrast to recent numbers for April from HBOS, the nation's largest mortgage lender, which said prices jumped 2% in that month - their biggest monthly rise in two years.
Nationwide said cooling demand for housing as well as rising interest rate expectations in financial markets - which drive mortgage costs as do official interest rates - may dampen property price inflation in coming months.
Meanwhile, British mortgage approvals fell to their lowest level in seven months in April in another sign that a recent revival in the housing market may peter out in coming months. The Bank of England said the number of mortgage approvals fell to 106,000 from 114,000 in March, the weakest since September last year.
