British house prices rose in August, according to data from mortgage lender Nationwide ​Building Society that suggested demand held up ‌despite an uncertain economic outlook and the impact of the war in Iran.

House prices last month were 1.6 per cent higher than a year earlier, speeding up ​from a 1.4 per cent increase in July, Nationwide said. The ​rise was below a 2.0 per cent increase forecast in a ⁠Reuters poll of economists.

Prices edged up 0.2 per cent in monthly terms in ​August, slightly above the 0.1 per cent rise forecast in the poll.

“Market activity ​and house prices have remained subdued in recent months, in part reflecting the uncertain economic backdrop,” said Robert Gardner, Nationwide’s chief economist.

“Geopolitical tensions remain high, ​with the conflict in the Middle East exerting upward pressure ​on energy prices and market interest rates.”

However, Gardner said affordability was improving.

Figures from Rightmove last month showed the biggest August fall since 2018 ​in asking prices for newly listed homes despite ​a ⁠modest pickup in activity after Prime Minister Andy Burnham took office.

Ashley Webb, senior UK economist at Capital Economics, said uncertainty over possible tax ⁠rises ​in finance minister John Healey’s upcoming budget ​could add to the restraints on house price growth in the coming months.