* UK house price growth cools in July
* Nationwide cites tougher mortgage checks
* But slowdown may prove temporary
(Adds more detail, economist reaction)
By Andy Bruce
LONDON, July 31 British house prices stagnated
in July after strong growth last month, cooled by tougher checks
on mortgage lending, a survey from lender Nationwide showed on
House prices gained just 0.1 percent month-on-month, the
slowest pace since April last year and down from 1.0 percent in
Economists polled by Reuters had expected a rise of 0.5
The survey is the latest to suggest rampant house price
growth has started to ease.
"At least part of the slowdown in activity relates to the
introduction of Mortgage Market Review measures," said
Nationwide chief economist Robert Gardner, referring to tougher
checks on mortgage affordability introduced in April.
"(But) with the labour market strengthening, mortgage rates
expected to remain low and consumer confidence rising, activity
is likely to recover in the months ahead."
Bank of England Deputy Governor Ben Broadbent said in a
Bloomberg interview published earlier on Thursday, however, that
"the edge is coming" off Britain's housing.
The BoE, which is keeping a close eye on Britain's
fast-recovering housing market, announced measures last month to
prevent a build-up of risky home loans.
On an annual basis, house prices rose 10.6 percent compared
with June's nine-year high of 11.8 percent, again slower than
the 11.3 percent forecast by economists, Nationwide said.
"One should be careful about interpreting too much from
July's marked slowdown in house prices," said Howard Archer,
chief UK and European economist at IHS Global Insight.
"We take the view that house prices will keep on clearly
rising over the coming months but there will be some moderation
from the recent peak levels."
A separate survey on Tuesday showed consumer sentiment in
Britain fell in July for the first time since in six months, the
latest survey to suggest Britons are feeling less upbeat about
the economic recovery.
(Reporting by Andy Bruce, editing by Jeremy Gaunt)