LONDON, Aug 1 Reuters British house prices fell by the most since 2009 in the 12 months to July, mortgage lender Nationwide said on Friday, as the drag from rising interest rates on the housing market intensified.

Compared with July last year, the average house price was down 3.8 after a 3.5 annual fall in June, Nationwide said.

The reading was in line with the consensus from a Reuters poll of economists.

House prices fell 0.2 monthonmonth, Nationwide said.

The survey chimed with other gauges of the housing market that point to weak activity caused by rising interest rates which have pushed mortgage rates above 6 for home buyers and existing mortgagors looking to refinance.

Nationwide chief economist Robert Gardner said the typical firsttime buyer with a deposit of 20 would see mortgage payments at current rates account for 43 of their takehome pay up from 32 a year ago.

This challenging affordability picture helps to explain why housing market activity has been subdued in recent months, Gardner said.

The Bank of England looks on course to raise its Bank Rate to 5.25 from 5.0 on Thursday, according to economists polled by Reuters, which would mark the highest cost of borrowing since 2008.

BoE data on Monday showed a surprise jump in mortgage approvals in June, although most economists think a downturn in the housing market has further to run with the bulk of the BoE39;s rate hikes since late 2021 yet to feed into the economy.

Still, Gardner said a relatively…