29
Jul
House prices are stabilising, says Nationwide
House prices are stabilising, according to the latest monthly
report from the Nationwide building society.
Prices across the UK rose by 0.2% in July, to £168,731,
leaving them just 0.4% lower than a year ago.
The society said demand for homes was still sluggish, and a
gradual rise in the supply of available houses was keeping prices
stable.
Separate figures from the Bank of England showed a slight rise
in mortgage activity.
Although prices are almost the same as they were a year ago,
since July 2010 they have fallen and then recovered, according to
the Nationwide's measurement.
Completed sales are still running at roughly half the level
recorded before the banking crisis. Since December 2010, the
average house price, not seasonally adjusted, has now gone up by
4%.
Economists often argue that the best guide to short-term trends
is to compare the average price over the last three months with
that of the previous three.
“Property transactions are at severely low levels due to
the disconnect between buyers and sellers” Matt Hutchinson,
Spareroom.co.uk
The building society's chief economist, Robert Gardner, said this
stability reflected the "uncertain" state of the economy.
"House prices remain relatively high compared to incomes and,
together with more demanding deposit requirements, this is
dissuading, or at least delaying, some first-time buyers from
entering the market," he said.
"The Nationwide talks of stability, but this is little more than
a euphemism for stagnation," said Matt Hutchinson, director of flat
and house sharing website Spareroom.co.uk.
"With the exception of London, property transactions are at
severely low levels due to the disconnect between buyers and
sellers. Properties are not selling because what buyers are
prepared to pay falls well short of what sellers are willing, or
able, to accept."
Figures released on Thursday by the Land Registry, which covered
prices in June, found that prices over the previous year had varied
significantly in different regions of England and Wales.
The number of home loans approved for house purchases rose
slightly in June, according to figures published on Friday by the
Bank of England.
“Pressures on household finances such as high inflation
and low wage growth are clearly taking their toll on the ability of
households to save” Adrian Coles, Building Societies
Association.
There were 48,421 mortgages approved for house purchases -
higher than the average of the previous six months of 45,850.
But, with few signs of interest rate rises in the coming months,
the pace of remortgaging activity has slowed.
Although there was a slight rise in the number of approvals for
remortgaging to 30,705, this was below the average of the previous
six months.
Consumer borrowing through loans and credit cards also rose
slightly in June, the Bank's figures showed.
Figures from the Building Societies Association (BSA) show that
the stock of savings held in mutuals in June shrunk by
£362m.
"Pressures on household finances such as high inflation and low
wage growth are clearly taking their toll on the ability of
households to save," said BSA director general Adrian Coles
Source: http://www.bbc.co.uk/news/business-14332061