UK House Prices Rise 1% in December
The average house price for properties in the United Kingdom rose 1% from November to £169,042 (US$269,320) in December, according to monthly research by leading UK lender Halifax. The average price now holds 1.1% above the year-ago level. It marks the sixth consecutive month of monthly increases. The average house price has now gained back 9.4% of the April 2009 low, which was 23% below the August 2007 peak. "The significant cut in interest rates following the worldwide financial upheaval in the autumn of 2008 has markedly reduced the burden of servicing a mortgage for many households," said housing economist Martin Ellis, in the Halifax research (download here). As HousingWire previously reported, the Bank of England’s Monetary Policy Committee voted Thursday to maintain the official bank rate paid on commercial bank reserves at 0.5%. The rate was reduced its current level in March and has held since. "This has helped to stimulate housing demand, albeit from a low base," Ellis said. "The recent improvement in the labor market, highlighted by increasing numbers of people in employment in both September and October, has also supported housing demand." Higher demand coupled with low supply continues to push up prices, Halifax found. Completed house sales in England and Wales were 11% higher on an annual basis, according to the latest available data -- which was released in September -- Halifax said. "The prospects for the market this year will depend on how the UK economy evolves and whether there is a significant increase in the supply of properties for sale. Overall, our current view is that house prices will be flat during 2010." Write to Diana Golobay.