Sunday, 8 April 2007

UK house prices - they just keep going up...

....but what goes up, must also come down.

This week, the Halifax Building Society issued price data for March. There are some very tentative signs of a slow down. However, other macroeconomic data suggests that the Bank of England is making little headway in curtailing inflation. Interest rates will go up and just as cheap credit fuels a bubble, higher interest rates will pop it.

Anway, here is what tha Halifax had to say about house prices this month:

• House prices rose by 1.0% in March, the second smallest monthly increase since August 2006.

• Overall, house prices increased by 2.8 percent in 2007 Q1, well below the 4.2 percent rise in 2006 Q4.

• The annual rate of house price growth has risen to 11.1 percent for purely arithmetic reasons, reflecting the strength of the housing market in early 2006. House price inflation should settle in coming months, given that recent conditions have been more subdued.

• House prices increased in all regions during 2007 Q1. The biggest price rises were in Scotland (7.5 percent), the South West (5.4 percent) and Wales (4.9 percent). The smallest increases were in the East Midlands (0.2 percent) and Yorkshire and the Humber (0.6%).

• The average price in Northern Ireland broke through the £200,000 barrier for the first time in 2007 Q1 (£206,495). Northern Ireland is now one of the most expensive parts of the UK with only London, the South East and South West having higher average house prices. Two years ago, Scotland was the only part of the UK with lower average house prices than Northern Ireland.

• Over the past year, house prices have risen most rapidly in Northern Ireland (37.0 percent) and Scotland (22.4 percent). Greater London (14.9%) has recorded the biggest increase in prices in England. The smallest annual price rises have been in the North (5.6 percent) and the East Midlands (5.8 percent).

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