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UK house prices accelerate again, but slowdown likely - Nationwide

Published 30/10/2020, 07:10
Updated 30/10/2020, 07:31
© Reuters. FILE PHOTO:  Estate agents' boards are displayed, amid the spread of the coronavirus disease (COVID-19), in Apsley, Hertfordshire

© Reuters. FILE PHOTO: Estate agents' boards are displayed, amid the spread of the coronavirus disease (COVID-19), in Apsley, Hertfordshire

LONDON (Reuters) - British house prices rose by the most in nearly six years in annual terms in October but the mini-boom in the housing market is likely to slow soon, perhaps sharply, mortgage lender Nationwide said on Friday.

Prices increased by 5.8% from September's 5.0% rise, faster than a median forecast of 5.2% in a Reuters poll of economists.

In monthly terms, prices were up by 0.8% from September, a slight slowdown but faster than the poll forecast of 0.4%.

Britain's housing market has defied a loss of momentum in the broader economy.

"However, activity is likely to slow in the coming quarters, perhaps sharply, if the labour market weakens as most analysts expect, especially once the stamp duty holiday expires at the end of March," Robert Gardner, Nationwide's chief economist, said.

Finance minister Rishi Sunak gave an extra boost to the housing market in July when he suspended purchase taxes for homes costing up to 500,000 pounds until the end of March next year.

Demand for homes with more space - reflecting the stay-at-home experience of many people during the lockdown - has also driven the housing market bounce-back.

The Bank of England said on Thursday that British lenders approved the highest number of mortgages since September 2007 in September, but there was a record drop in unsecured lending to consumers, suggesting growing caution among households.

© Reuters. FILE PHOTO:  Estate agents' boards are displayed, amid the spread of the coronavirus disease (COVID-19), in Apsley, Hertfordshire

Latest comments

Realestate prices going up is with countless bristish citizens loses their jobs is broaden the economic gap between rich and poor.
Wait for the depession after the covid, Then you will see the gap widen, negative equity, job losses, repossessions, bankruptcy’s ...sad but ture, new buyers should be made aware of this, but banks still thowing money out there as they have done before.
is it people trying to move from tier 3 to tier 1
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