Tuesday, 12 December 2006Property Prices Keep Up
The average UK house price sailed past the £170,000 mark after further strong growth in November.
Prices during the month jumped 1.4% compared to a 0.8% rise in October, said Nationwide Building Society.
That pushed the annual rate of growth up to 9.6% - the highest year-on-year increase seen since February 2005.
The typical house has added more than £15,000 to its price over the last 12 months, with the average cost now at £172,185.
And a lack of sufficient new houses on the market could see increases continue over the short term, experts said.
"Some cooling seemed to be in prospect when the growth of buyer enquiries fell quite sharply in September, but this pause in demand was short lived," said Nationwide's Fionnuala Earley.
"At the same time, stocks of properties for sale are at a two-year low, leaving buyers chasing relatively few properties."
On the other hand, there have been warnings of possible house price falls.
Economist David Miles, a former adviser to Gordon Brown, earlier this month suggested that substantial house price falls were likely over the next few years.
Ms Earley commented: "A sustained period of rapid house price growth when affordability is stretched automatically leads to speculation about when prices may begin to fall.
"We have argued before that affordability must eventually bite, which limits the prospects for rapid nominal house price gains to continue far into the future.
"However, the likelihood and size of any fall will depend on how overvalued the market already is."www.news.sky.com/propertynews |