House Prices

30 November -0001

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House prices in the UK rose by 0.5% in February, according to the Nationwide building society.

The figure means the annual rate of increase in the UK is down to 10.2%, the lowest rate since June 2001, which in turn is half the rate prices were rising last August.

After intervention by the Bank of England by increasing interest rates there has been a steady fall in the annual price rises, with the average price currently £152,880.

The housing market is now subdued but is still experiencing a slight sustainable growth which hopefully will avoid a total collapse in the sector.

Nationwide figures in January had house prices were climbing by 12.6% annually so even though the rate is still falling the market is not collapsing in the way some had feared, say the nationwide in the report.

The feeling that the UK housing market was heading for a downturn after four years fast growth to 2004, seems not to be materialising, with the Woolwich, forecasting an 8% fall in property prices in 2005, followed by further declines in 2006 and 2007, Price-waterhouse-Coopers staing house prices were overvalued and should fall by up to 15% over the next four years.

House prices are expected to rise by 1% over the next six months, according to a survey of customers.

The Bank of England though announcing that its job is not to control the housing market while actively seeking to cool the market may decide to intervene further and increase interest rates again.

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