Anorak News | House Prices Rise By 10% In A Year

House Prices Rise By 10% In A Year

by | 31st, May 2007

houses.jpgTHE property boom may be starting to cool down, but house prices are still on the up, according to figures released by the Nationwide.

The building society claim that the average British house now costs £181,584, almost £17,000 or 10.3% up on May 2006.

However, the figures also reveal a slowdown in the market, with prices rising by 0.5 per cent in May compared to the 0.9 per cent rise in April.

Nationwide bigwig Fionnuala Earley has warned of yet another interest rate rise, something that could put off even more first-time buyers from starting their climb up the proverbial property ladder.

Says she: “The housing market is still showing signs of cooling and should therefore add little to the upside inflationary risks considered by the MPC. The three-month on three-month rate of growth still shows a clear downward trend as the effect of earlier increases in interest rates takes hold. However, higher interest rates, with the threat of more on the horizon, should signal caution to those thinking about stretching themselves to get a foot on the ladder.”

Global Insight’s Howard Archer isn’t surprised by the figures either. “The Nationwide data is consistent with our expectation that house prices will lose buoyancy gradually over the coming months as demand is increasingly pressurized by the rising affordability pressures stemming from higher interest rates, modest real disposable income growth and elevated house prices,” says he.

Did you get that? Mr Archer works for, er, ‘Global insight’. For more clear-as-mud news on the housing market, stay tuned…

Supermarket giant Asda’s credit card reward scheme has apparently saved their customers £1million at the petrol pump.

Posted: 31st, May 2007 | In: Money Comment | TrackBack | Permalink