Year-on-year house prices creep up
Updated on 30 October 2009
House prices have risen for the sixth month in a row, pushing them 2 per cent higher than they were at the same time last year.
The figures from, Nationwide Building Society, show the first annual house price rise for 19 months, but the rate of increase has begun to slow.
The average value of a UK house increased to £162,038 after six months in a row of rises, helping prices grow year-on-year by 2 per cent in October.
But the data showed a slowdown in the monthly pace of increase following the buoyant summer months, down from 0.9 per cent in September and 1.4 per cent in both July and August.
Nationwide said the ease in monthly growth may signal that more properties are coming on to the market.
Martin Gahbauer, Nationwide's chief economist, said: "A moderation in the rate of house price inflation was to be expected, as the very strong monthly increases seen over the summer months were unlikely to be sustainable over the long run."
He added: "Although too early to tell for sure, it may also reflect a more natural level of stock available for sale coming to the market, alleviating some of the extreme shortages of property on the market seen during most of this year."
Nationwide warned the UK's failure to lift out of recession in the third quarter may further hamper the housing market recovery.
But the fall in third quarter gross domestic product has also increased the likelihood that interest rates will stay low for some time in a possible boost to property conditions.
"As a result, mortgage affordability will remain relatively favourable for both new and existing borrowers - this should limit the number of distressed sales and cushion the negative impact of labour market weakness on housing demand," said Mr Gahbauer.
