Property News

Thursday, August 31, 2006

Sharp rise in August

Nationwide Building Society have announced today that house prices rose sharply in August. The cost of an average home increased by 0.8% on the month, matching July's monthly gain. This lifts the annual rate of house price inflation to 6.6 %, its fastest since April 2005.

The figures indicate that the Bank of England's suprise rate rise at the start of the month has done little to slow the property market. Nationwide believe that prices are unlikely to fall as fast as they did the last time interest rates went up.

"While we expect base rates to reach 5 percent by the end of the year, above the peak of the last rising cycle, we do not expect the market to slow as sharply as before," said Fionnuala Earley, the Nationwide's Group Economist.

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