Britain's house prices cooled only slightly last month, a key survey showed Thursday, but remain vulnerable to rising interest rates and the cost of living crisis.
The average value of a home in Britain rose 10 percent to £273,751 (US$318,627) in August from a year earlier, home-loans provider Nationwide said in a statement.
Annual growth remained in double digits with the average property costing £50,000 more than two years ago.
Yet that marked a modest slowdown from 11-percent expansion in July.
Nationwide warned the housing market would slow further on soaring domestic energy bills and rising interest rates.
"There are signs that the housing market is losing some momentum, with surveyors reporting fewer new buyer inquiries in recent months and the number of mortgage approvals for house purchases falling below pre-pandemic levels," said Nationwide economist Robert Gardner.
"We expect the market to slow further as pressure on household budgets intensifies in the coming quarters, with inflation set to remain in double digits into next year."
Consumer price inflation rocketed in July to a 40-year peak of 10.1 percent, worsening a cost-of-living crisis as Britain faces the prospect of recession.
Goldman Sachs analysts have forecast inflation could hit 22.4 percent next year under a worse-case scenario, if domestic energy prices continue to rocket.
The Bank of England last month hiked rates by 0.5 percentage points, the biggest hike since 1995, taking borrowing costs to 1.75 percent as it sought to tackle runaway inflation.
Rising interest rates drive up mortgage repayments for households but boost savers. - AFP