House price increase seen in March

Figures released by the High Street lender, Nationwide, have indicated that there was an increase on property prices for the month of March, with property prices increasing by more than £3000 according to the figures. Officials from Nationwide have added, however, that the annual rate of inflation on house prices is set to slow down from its current 9 percent.

In the month of February average property prices fell by 0.8 percent according to Nationwide, but in the month of March property values bounded back with an increase of 0.7 percent. In price terms this reflected an actual rise of 2 percent before any seasonal adjustments were taken into account.

The decrease in property prices that was seen in February resulted from a slowdown in demand and a drop in the number of mortgage approvals. This was partly attributed to the end of the stamp duty holiday, which had caused more people to push through property sales at the end of last year and caused an unusually profound dip at the start of this year.

Nationwide has stated that the average property price in the UK is now £164,519, and compared to February of 2009 this was £16,733 higher. However, quarterly house price inflation has fallen from 3.8 percent seen in September to 1.6 percent in March.

An economist from Nationwide stated: ‘The last two months are consistent with a relatively flat profile for house prices, and in line with the recent drops seen in buyer enquiries and house sales. Preliminary figures show that the number of loans taken out for house purchases failed to recover from January’s large dip, suggesting that weakness in house sales at the start of the year may have been due to more than just the snowy weather.’

Tags: property, house, prices, rise, nationwide

Stamp duty shows record increase

The total value of stamp duty generated by the sale of residential property rose by a record level during the year 2006 to 2007, a new report has said.

According to Halifax, HMRC figures reveal that stamp duty revenue rose by 40 per cent over the year to hit £6.4 billion.

The bank also claimed that the last five years have seen a 140 per cent increase in this revenue, up from £2.7 billion in 2001 to 2002.

It is the south of England that has contributed most to stamp duty revenue, the report said, accounting for 73 per cent of the total.

In addition, the higher bands for the tax – three per cent for properties over £250,000 and four per cent for those over £500,000 – contributed 79 per cent of revenue.

“The revenue generated from stamp duty on property purchases has soared as governments of both political parties have failed to link thresholds to house price inflation,” Martin Ellis, chief economist at Halifax, commented.

Addressing the Conservative Party conference in Blackpool the shadow chancellor George Osbourne pledged to increase the stamp duty threshold if they are elected, meaning only properties worth £250,000 or more would qualify.

Currently, homes with a value of between £125,000 and £250,000 are subject to a one per cent stamp duty levy.

Tags: Conservative, Blackpool, government, price, cent

CML chief: Housing market to come off boil

The director general of the Council of Mortgage Lenders (CML), Michael Coogan, has claimed that house price inflation will cool off dramatically next year.

Speaking to Reuters, he said that prices seem likely to record their smallest increase in a decade, at maybe just two to three per cent, partially due to rises in interest rates.

The Bank of England set the new base rate at 5.75 per cent two weeks ago – the fifth rise in a year – and many analysts predict further increases in coming months.

Mr Coogan counselled against fears of a slump in prices: “I don’t believe there will be a crash. But clearly a slowdown is more likely”, he said, pointing to the still robust economy as a bulwark against forced house sales.

He added that “we’ve already seen on the consumer credit side that loans have been reduced and people are looking to repay their credit card and other debts… That trend is likely to continue.”

The prospect of a dramatic slowdown seems distant, however: Figures released by the Department of Communities and Local Government today show still-strong inflation, with annual house price rises remaining in the double percentage figures: inflation in prices stood at 10.9 per cent in May, against 11.3 per cent the previous month.

The figures also showed regional variations – with inflation particularly strong in London, Scotland and Northern Ireland.

http://uk.reuters.com/article/personalFinanceNews/idUKNOA64267220070716?rpc=401&
http://business.timesonline.co.uk/tol/business/economics/article2083427.ece

Tags: price, ece, I don't believe, price inflation, show, consumer, cml, crash