House prices are at risk as spending power is set to take a big hit, the boss of Nationwide Building Society has warned. Joe Garner said higher prices and interest rates, together with steep rises in the cost of living, mean buying a home will be tougher. He believes higher inflation, which has been exacerbated by the war in Ukraine, is likely to exert a significant drag on the economy in the near term. This may then place significant pressure on household budgets, especially for those on lower incomes who also accumulated fewer savings during Covid-related lockdowns. that could also result in a fall in house prices. His remarks came as the UK’s biggest mutual reported a near-doubling of annual profits on the back of buoyant mortgage demand. Despite unemployment hitting a record low this week, surging costs are piling pressure on people’s pockets, leaving buyers with less cash to save for a deposit.

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