House prices rise 5.2% in final quarter of 2007

Figures from Halifax for the fourth-quarter of 2007 show a 5.2% rise in house prices, on the same period of 2006.

Taking the UK as a whole, average house prices in the fourth-quarter were slightly lower than in the third-quarter, down -0.8%.

Prices rose in four regions: Scotland 2.4%; West Midlands 2.1%; Wales 0.9%; and North West 0.6%.

The largrest price falls were recorded in Greater London -6.3%; South East -2.3%; and East Midlands -2.3%.

During the whole of 2007, average prices increased in all regions with Scotland recording the biggest rise, at 13.1%.

Inflation was driven by the region’s relative affordability. The average price of a house in 2007 was £144,897 or 26% less than the UK average of £197,071.

Northern Ireland saw the second highest rise, at 9.3%, followed by the South East, 7.0%.

It should be noted that the annual increase in Northern Ireland was well below the 52.9% seen in 2006.

Scotland and the North both recorded higher house price increases in 2007 than in 2006; all other regions experienced a slowdown in property inflation.

Halifax is maintaining its forecast that UK house prices will remain flat in 2008, although regional variations are only to be expected.

The lender in predicting modest price growth across southern England and Scotland, while worsening affordability is expected to cause a modest fall in prices in northern England and the Midlands.

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