House prices bounce back
- Published: 28/06/2007
House prices rose strongly again in June - after many experts forecasted a downturn following a slow month in May.
Figures from the Nationwide Housing Index show prices were up by 1.1 per cent on average during June - a strong increase following the 0.5 rise reported in May. The annual rate of house price inflation now stands at 11.1 per cent - compared to May's rate of 10.3 per cent.
The price of a typical house is now £184,070, which is an increase of £18,000 on the same figure at this point last year. Prices have risen by £50 per day over the last 12 months.
"The resilience of the housing market will be another component to add to the rate rise camp's argument," Fionnuala Earley, Nationwide's Chief Economist, said.
"Earlier house price data had shown the start of a slowing in the market, but while too much emphasis should not be placed on one month's figures, the fact that today's data shows a bit of a bounce will add to the upside risks being counted up at the Bank of England.
"While we expected interest rates to increase to 5.75 per cent in August, this news, together with the revelation that rates remained on hold by only the narrowest of margins in June, will set the stage for that rate rise to move forward to July and for the risk of a rise to six per cent to increase significantly."
Figures from the Nationwide Housing Index show prices were up by 1.1 per cent on average during June - a strong increase following the 0.5 rise reported in May. The annual rate of house price inflation now stands at 11.1 per cent - compared to May's rate of 10.3 per cent.
The price of a typical house is now £184,070, which is an increase of £18,000 on the same figure at this point last year. Prices have risen by £50 per day over the last 12 months.
"The resilience of the housing market will be another component to add to the rate rise camp's argument," Fionnuala Earley, Nationwide's Chief Economist, said.
"Earlier house price data had shown the start of a slowing in the market, but while too much emphasis should not be placed on one month's figures, the fact that today's data shows a bit of a bounce will add to the upside risks being counted up at the Bank of England.
"While we expected interest rates to increase to 5.75 per cent in August, this news, together with the revelation that rates remained on hold by only the narrowest of margins in June, will set the stage for that rate rise to move forward to July and for the risk of a rise to six per cent to increase significantly."