–Adds Detail To Version Transmitted At 0614 GMT Wednesday
–House Prices Up 0.6% m/m In July; Up 4.9% 3m y/y
LONDON (MNI) – UK house prices rebounded in July, confounding
analysts’ expectations, according to the latest Halifax survey.
July house prices were up 0.6% on the month to stand up 4.9% on
the year, reversing the 0.6% monthly fall seen in June. The July survey
from rival mortgage lender Nationwide showed house prices falling 0.5%
on the month in July, and analysts had predicted the Halifax survey
would show another monthly decline.
In the Halifax series, average house prices are 16% below their
August 2007 peak but 8.3% up from their trough in April last year.
The Halifax said “housing market activity is broadly stable.”
Halifax analysis attributes the resilience of house prices to the
relative affordability of mortgage payments as a result of historically
low interest rates.
It said typical mortgage payments for a new borrower have fallen
below their long run average of 37%, dropping from a peak of 48% of
average disposable earnings in 2007 Q3 to 30% in 2010 Q2.
The underlying picture for house prices so far in 2010 is, however,
broadly flat, with July house prices 0.8% lower than at the end of last
year.
Martin Ellis, Halifax housing economist, said “Overall, there has
been little change in prices during 2010 so far. The mixed pattern of
monthly rises and falls over the first seven months of the year is
consistent with a slowing market.”
Ellis added that the data support Halifax’s views that house prices
“will be broadly unchanged over 2010 as a whole” with the rise in the
number of properties up for sale counteracting the supportive effects of
low interest rates and a recovering economy.
–London newsroom: 44207 862 7491; email drobinson@marketnews.com
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