Nationwide reports 1.3% rise in house prices
In the first house price survey covering the whole of July, the Nationwide has reported that the average value of a UK home rose by a seasonally adjusted 1.3% compared with June, to £158,871.
According to the lender, the three-month-on-three-month rate of change, which is generally regarded as a more reliable indicator, saw a rise from 1.0% in June to 2.6% in July, the highest level since February 2007.
On this basis, the annual rate of fall stands at 6.2%, easing back from the 9.3% year-on-year decline recorded in June.
Nationwide points out that even if prices were to remain unchanged for the rest of 2009, the year-on-year rate would continue to improve, since prices were falling very sharply in the second half of last year.
The building society’s chief economist, Martin Gahbauer, comments: “For the first seven months of 2009 as a whole, prices have risen by a cumulative 1.3%, suggesting there is now a reasonable chance that prices could end the year slightly higher than where they started.”
He adds “Only a few months ago, such an outcome would have appeared unthinkable.”
However, UK house prices are currently underpinned by a shortage of properties for sale and mortgage lending, which is essential to breath life into the market, remains stubbornly low.