UK house prices dip unexpectedly in April - Nationwide

LONDON Wed May 1, 2013 7:40am BST

A woman walks past houses on a street in London March 13, 2012. REUTERS/Luke MacGregor

A woman walks past houses on a street in London March 13, 2012.

Credit: Reuters/Luke MacGregor

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LONDON (Reuters) - British house prices dipped unexpectedly in April from March but a recently extended credit scheme should buoy the market in coming months, mortgage lender Nationwide said on Wednesday.

Nationwide said house prices inched down 0.1 percent on the month and were 0.9 percent higher than in April 2012.

Both readings were weaker than forecasts by economists in a Reuters poll.

Nationwide's chief economist Robert Gardner noted that comparing the latest three months with the previous three months - a smoother measure of the underlying trend - house prices have been rising since October.

"The number of mortgage approvals has edged up from the levels prevailing last year and there are reasons for optimism that activity levels will continue to strengthen in the months ahead," he added.

Nationwide said policies aimed at improving the supply and the cost of credit, such as the central bank's Funding for Lending Scheme, should continue to support the housing market.

Home buyers, as well as banks, have been the main beneficiaries of the scheme so far.

Last week the Bank of England retooled the FLS, giving banks greater incentives to lend to small and medium-sized firms. Banks can now also get funding from the programme for an extra year until the end of January 2015.

(Reporting by Olesya Dmitracova; Editing by Catherine Evans)

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