British house prices experienced a modest rise in June compared to May, but the property market remains under pressure from elevated borrowing costs, according to

mortgage lender Nationwide on Monday.

House prices increased by 0.2% month-on-month and were 1.5% higher than in June last year, Nationwide reported.

The UK housing market saw a boom during the coronavirus pandemic but has since slowed down after the Bank of England raised interest rates to their highest levels since 2008 last year.

According to Nationwide, house prices are currently around 3% below their peak from two years ago.

Robert Gardner, chief economist at Nationwide, noted, "While earnings growth has outpaced house price growth in recent years, it hasn’t been sufficient to counteract the impact of higher mortgage rates."

The UK's opposition Labour Party, which is leading in opinion polls ahead of Thursday's election, has pledged to relax planning regulations to boost construction, aiming to make housing more affordable.

Nationwide also highlighted that prices in London rose by 1.6% during the April-to-June period compared to the same quarter in 2023.

A Reuters poll of housing market analysts, published on May 29, indicated that UK property prices are expected to rise by 1.8% in 2024 as higher wages make homes more affordable.