United Kingdom: House prices rise to highest level in over five years
November 29, 2013
According to the Nationwide Building Society (NBS), home prices in the U.K. rose 0.6% over the previous month in November. The increase, which met market expectations, came in below the 1.0% rise recorded in October. On an annual basis, home prices rose 6.5% (October: +5.8% year-on-year). As a result, the prices reached a level of €174,566 (November 2012: €163,853), which is the highest in more than five years.
The increase in home prices comes on the back of a better outlook for the housing market. According to the NBS, "policy measures aimed at keeping down the cost and improving the availability of credit are playing an important role." On 29 November, Bank of England Governor Mark Carney announced that the Funding for Lending Scheme (FLS) will be closed in January 2014. FLS was launched in August 2012 with the aim to give lenders financial incentives to provide home loans. The decision to stop the program could stall growth on the housing market.
Author: Dirina Mançellari, Senior Economist