Friday, May 31, 2013

House prices rise at fastest pace since November 2011 - Nationwide

LONDON (Reuters)- House prices have risen at their fastest annual rate since November 2011 this month, buoyed by a Bank of England initiative to reduce the cost of credit, data from mortgage lender Nationwide showed on Thursday.

Nationwide said house prices rose by an annual 1.1 percent in May, slightly more than expected and up from April's 0.9 percent annual increase. On the month, prices were 0.4 percent higher, in line with forecasts, after holding steady in April.

"There has been an improvement in the availability ... of credit, partly as a result of policy measures, such as the (BoE's) Funding for Lending Scheme. Indeed, mortgage rates have fallen back towards all-time lows in recent months," said Nationwide's chief economist, Robert Gardner.

Nationwide added that the number of property sales in the first four months of 2013 was 5 percent higher than the average in 2012 as a whole.

It forecast further price rises to come due to an improved economy, though a softening labour market and falling real wages would limit gains.

Chancellor George Osborne also announced a 'Help to Buy' scheme in his annual budget statement in March that offers home-buyers subsidised mortgages - something many economists predict will push up house prices.

(Reporting by David Milliken; editing by Ron Askew)

Source: http://news.yahoo.com/uk-house-prices-rise-fastest-pace-since-nov-060247849.html

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