Strong start to 2010 for house prices |
Nationwide’s figures for January 2010 show that house prices rose by 1.2% in month, and bring the year on year rate of increase to 8.6%. This brings the cost of the average UK home to £163,481. Following 9 consecutive months of property price increases, then unless there is a sudden change in February, annual rate of price increase will move to double figures for the first time since May ’07.
News that the UK economy finally emerged from recession in the fourth quarter of 2009 has strengthened confidence in the property market, even though the emergence was very weak (i.e. 0.1%!).
Unfortunately though, house price increases are not being matched by average earnings increases, with many workers facing pay freezes or even cuts. This could ultimately at least slow the house price recovery or even bring it to a halt, if demand for houses drops.
