|Figures released by Britain’s Office of the Deputy Prime Minister (ODPM) on January 16 show that British house prices rose 2,5% from year ago levels in November 2005, compared to a revised 1,5% in October. according to an article on the Royal Institution of Chartered Surveyors (RICS) website.|
The pace of house price inflation, on the government’s official measure has rebounded upwards but remains close to October’s 9 half year low.
House price inflation has been hovering in the range of 2-4% since July, as the market settles after a marked slowdown since mid 2004. The August interest rate cut along with continued strength in employment has supported housing market conditions, with mortgage activity above its long-run average.
The RICS article says it is interesting to also note that while overall British house price inflation has slowed to less than the growth rate of wages back in July, in the case of first time buyer (FTB) properties, prices in November were still rising at 5,2% per annum, which is ahead of wage rises.
Prices of FTB homes have consistently grown faster than the average for all homes since January 2004.
Prices for FTB homes are now 18% higher than they were in January of 2004 compared with 15% growth in prices for all homes over the same period. This means that affordability remains a major issue for FTBs, despite the housing market slowdown of the past year.