Nationwide reports increase in house prices

| November 29, 2011
Nationwide reports increase in house prices

The latest house price figures from Nationwide Building Society contradict yesterday’s news from the Land Registry that house prices have fallen over the past year.

Nationwide today said that house prices are ‘surprisingly resilient’ with November’s figures showing a year-on-year increase of 1.6%.

In contrast the latest Land Registry figures showed a 3.2 per cent fall in prices over the year.

Nationwide’s house price survey, which is based on its own mortgage data, showed house prices continuing an upward trend in November, when they increased by 0.4 per cent to £165,798.

In October 2011 they grew by 0.8 per cent, compared with the same month in 2010.

The building society also reported that the number of mortgages approved for house purchase, but not yet completed, increased to 52,743 in October, the highest level since December 2009.

Nationwide expects house prices to either remain steady, or to fall in the next 12 months, due to the uncertain economic climate.

Robert Gardner, the Nationwide Building Society’s chief economist, said: “with the UK economic recovery expected to remain sluggish well into 2012, house price growth is likely to remain soft, with prices moving sideways or drifting modestly lower over the next twelve months”.

The market for new homes is struggling in the face of high levels of unemployment, wage freezes and other pressures on household incomes causing consumer confidence to fall.

With the Chancellor due to deliver his Autumn Statement imminently, Nationwide is calling for the Stamp Duty threshold for first-time buyers to be kept at £250,000.

The threshold is due to end in March 2012 but Nationwide warns that this could deter many first-time buyers from entering the housing market.

The building society also wants the chancellor to increase the annual cash ISA limit to £10,680, the same as the equity ISA limit, to help prospective house buyers save for a deposit.

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