Annual House Price Growth Hits 11% Says Report

The slowdown in house price growth of recent months could have been short-lived, with home costs accelerating in August.

estate agents

  The Nationwide study calculated growth of 0.8% – the sixteenth successive monthly price rise – leaving       the annual pace of house price growth up to 11% from 10.6% in July.

  The report said that while the figures highlighted a growing gulf between housing costs and wage rises –      most recently measured at -0.2% – affordability was not stretched by historic standards.

 

Its figures were released as separate Land Registry statistics – covering the year to July – measured growth of 7.2% nationally.

London house prices were found to have grown by 19.3% annually – the biggest year-on-year increase in the capital in more than a decade.

Robert Gardner, Nationwide’s chief economist, said: “The outlook for the housing market remains highly uncertain.

“The number of mortgage approvals fell by almost 20% between January and May, suggesting that activity was cooling.

“However, there was a modest rebound in June and it is unclear how much of the slowdown was due to the introduction of Mortgage Market Review rather than an underlying loss of momentum.

“Surveyors report that new buyer enquiries have moderated somewhat in recent months, and the prospect of interest rate increases together with subdued wage growth may temper demand in the quarters ahead.

“However, the brightening economic outlook is likely to provide ongoing support for housing demand.

“Consumer sentiment remains buoyant thanks to declining inflation and sustained increases in employment.”

He also pointed to the continuing weak supply of homes on the market as a factor likely to support price growth.

But separate research released by property analyst Hometrack has found the gap between house sellers’ asking prices and the amounts that buyers are willing to pay is widening.

Hometrack said this pointed to the pace of house price increases slowing in the coming months.

By (c) Sky News 2014 | Sky News

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House price rises realise bubble fears, says economist

Economics professor says three-quarters of properties in the UK are overvalued, as Zoopla reports property price growth across the country.

The average UK home has seen its value rise by £10,329 over the past year, or by £28.30 a day, according to figures from property search engine Zoopla.

Gothic style Victorian terraced houses in south London

This follows research from a leading economics professor that around three-quarters of properties in the UK are overvalued, with a 93% probability that London is already in the grip of a house price “bubble”.

“The results raise the risk – although not the certainty – that house prices will fall,” said professor James Mitchell, the head of economic modelling and forecasting at Warwick Business School. “But a bubble it appears to be, and we should all – householders, business people and policymakers alike – be alert to this risk.”

More: The Guardian