IPM Property News
House Prices Soaring Even Faster
Source: Daily Express 9th March 2007
HOME owners have double cause to celebrate today as a key report showed prices are soaring as interest rates were put on hold.
Fears of a downturn in the market were dispelled as annual price rises hit nearly 10 per cent and experts predicted the upward trend will continue throughout 2007.
The Bank of England’s decision yesterday to keep interest rates at 5.25 per cent brought relief to those with mortgages who have been battling to cope with higher bills caused by three increases in six months.
Meanwhile, Britain’s biggest mortgage lender, the Halifax, revealed that prices increased by 1.8 per cent last month – up from 1.3 per cent in January – pushing the annual rate to 9.9 per cent.
That means the average home owner saw the value of their property rise by £3,500 in February alone.
It really is bonanza time for sellers as demand for homes outstrips supply.
The shortage of properties on the market is driving up prices significantly, especially in London and the South-east.
Michael Coogan, director general of the Council of Mortgage Lenders, which last month announced record lending figures, said: “The commentators who thought the housing market would crash in 2006 were wrong.
“Last year the market proved itself to be in robust shape and we expect it to remain so during 2007.”
Barry Steer, of estate agents Kinleigh Folkard & Hayward, said: “In the London market, demand is far outstripping supply".
Martin Ellis, chief economist at the Halifax, said: “A shortage of both new and second-hand properties available for sale has continued to push house prices up so far in 2007, particularly in London.
Nationwide has also reported a lack of homes for sale. “This lack of supply will mean that house price inflation will remain firm for a while longer, before gradually easing,” predicted Fionnuala Earley, Nationwide’s chief economist.
According to its figures, annual house price inflation across the UK is 10.2 per cent and the typical home costs £174,706 – more than £16,000 higher than this time last year and the equivalent of a rise of more than £40 a day.
The decision yesterday not to increase interest rates was widely welcomed.
David Bexon, of SmartNewHomes.com, said: “The Bank’s announcement will send waves of relief across the housing market.”
Robert Bryant-Pearson, chief executive of Allied Surveyors, the UK’s largest independent firm of chartered surveyors, described the decision as sensible.
