House prices rise 1.9% but property market remains 'subdued'
Annual house price growth edged up to 1.9 per cent in November to £214,044 but the market remains “subdued” thanks to an uncertain future for the economy, according to Nationwide.
The building society’s index registered a 0.3 per cent monthly increase in selling prices during November after zero growth in October.
Squeezed household budgets are likely to continue to dampen demand, despite low borrowing costs and the official unemployment rate at a 40-year low, Nationwide predicted.
“If the uncertainty lifts in the months ahead and employment continues to rise, there is scope for activity to pick up through next year,” said Robert Gardner, Nationwide’s chief economist.
“The squeeze on household incomes is already moderating and policymakers have signalled that, if the economy performs as they expect, interest rates are only expected to rise at a modest pace and to a limited extent in the years ahead.”
An increased supply of new homes has eased the pressure that helped prices soar over the past decade.
The number of houses being built fell nearly 60 per cent after the financial crisis but is now back up to 195,300, just 3 per cent below 2007/8 levels. Read More