Insurance News Archive
Property values bounce back
Price growth in March of 1.1 per cent has led property pundits to hail the advent of a spring boom.
Publishing their monthly housing report Nationwide showed that the average house price was now £162,083, up by over £8,000 during the last twelve months.
Strong demand for new properties had risen by 5.4 per cent in the second half of 2005 compared to a rise of only half that in the number of available houses, contributing to the present price increases.
"The housing market seems to have shrugged off bad news about job losses and downside risks to economic growth," Nationwide said.
"The pick up in prices in March continues the upward trend we have seen since the autumn, which has been supported by a solid return of buyers."
But Nationwide predicted that rising utility bills and affordability problems would limit any further increases, saying that a natural ceiling on spending had been reached.
Experts have suggested that the strong housing market will prevent the Bank of England from cutting interest rates because of fears that a damaging housing boom might be sparked.
© Adfero Ltd
30 Mar 2006