After three months of flat house prices, growth picked up in July with annual house price growth now at 5.9 per cent – more than double the rate of growth seen this time last year when prices were increasing at an annual rate of 2.6 per cent.
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Fionnuala Earley, Nationwide’s group economist, said: “The strong rate of annual house price growth reflects the weak patch in prices this time last year. The three-monthly rate of growth has picked up slightly compared with last month, but remains on a fairly benign trend.”
The price of a typcial house in the UK is now £167,733, which is £9,385 more than at the same time last year.
Earley continues: “Indicators of market activity suggest that housing market demand remains fairly buoyant. This will help to support prices, at least in the short term. House purchase approvals picked up surprisingly strongly to 120,000 in June to equal the peak at the turn of the year.”
Estate agents’ stock to sales ratio is a good indicator of changes in the balance of supply and demand in the market and of the direction of house price movements a few months later. The stock to sales ratio has been climbing since the summer of last year. However, the ratio has been broadly stable for the last three months which may suggest some softening in price increases in the latter part of the year.
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