Thursday, July 30, 2009

Are house prices rising in the UK? Yes, barely. Will this continue? Probably not. Many economists are sceptical that the run of good news on house prices will continue. Although mortgage approvals for homes have risen sharply, they remain below the levels that many think are consistent with rising prices. Furthermore the Royal Institute for Chartered Surveyors has said that although demand for housing has risen sharply, house prices appear to be being supported by a lack of supply as wary sellers keep their properties out of a depressed market. Finally, with unemployment expected to continue to rise, demand for house purchases may well ebb later in the year.

SHOOT: It's a bit like expecting to hold a candle and keep the flame flickering under a waterfall. You just can't maintain growth or increased property markets with an economy shedding jobs.
clipped from

House prices in the UK rose by 1.3 per cent in July, according to the latest figures from Nationwide, taking the rate of growth over the last three months to its highest level in more than two years and adding to signs that the housing market is bottoming out.

Prices rose for the third month in a row, the Nationwide index showed, following increases of 1 per cent in June and 1.3 per cent in May. The three-month-on-three-month rate of change reached 2.6 per cent, the highest since February 2007.

For the first seven months of 2009 as a whole, prices rose by a cumulative 1.3 per cent, suggesting there is now a reasonable chance that prices could end the year slightly higher than where they started. Only a few months ago, such an outcome would have appeared unthinkable,” said Martin Gahbauer, Nationwide’s chief economist.

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