 | House prices rise againArticle Published: 20:06 04/03/2007Article Classification: Olive Tree Head Office |
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UK house prices are still rising although not at the rates seen over the past ten years. House prices rose another 0.7% in February, says the Nationwide building society.
The numbers of buyers and new loans for house purchases have dipped, but there are still relatively few homes advertised for sale. “This lack of supply will mean that house price inflation will remain firm for a while longer, before gradually easing,” predicts Fionnuala Earley, Nationwide’s chief economist. She says annual house price inflation across the UK is 10.2% and the typical home costs £174,706. This is more than £16,000 higher than this time last year and the equivalent of a rise of more than £40 a day.- The price of farmland is soaring thanks to bonus-waving townies, says the Royal Institution of Chartered Surveyors (Rics).
Prices grew 18% in the second half of 2006 compared to just 6% in the first half; farmland is at a four-year high of £8,164 a hectare, up from £7,219 in early 2006. “City slickers are still attempting to take advantage of low farmland prices with bonuses encouraging City lifestyle trends,” says Sue Steer, Rics’ rural affairs representative.
She says British farms are also being bought by investors from Denmark and Ireland, where farm prices are much higher.- One of Britain’s biggest housebuilders says recent interest rate rises have had no discernible effect on the market. Persimmon says in the first seven weeks of 2007, when rates rose for the third time in six months, its level of cancellations actually fell to 15% from 19% in the same period last year.
Persimmon made a pretax profit of £582.1m in 2006, up 17.5% on its 2005 figure, £495.4m. - Central London property is set for more big rises this year, predicts Cluttons estate agency. It says prices of homes on sale will increase 9% to 13%, largely driven by continuing high earnings in the financial services sector. Rents in the capital will rise by up to 7% for the same reason.
- Property prices rise because local populations grow, a new survey claims, London is typical of the trend. Since 1996 it has seen the largest population growth (8% annually compared to a UK average of 5%) and price growth (216% for the decade, compared to the UK’s 191%).
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