House prices edge up further in November
The building society said that the average home increased in value by 0.5% in November compared with October and now costs £162,764. The year-on-year price of a typical home was 2.7% more expensive than a year ago, up from 2.0%.
However, the Nationwide said that the three-month on three-month rate of increase had slowed from 3.5% in October to 2.8% in November.
Commenting on the figures Martin Gahbauer, Nationwide’s chief economist, said: “At £162,764, the average house price is at a similar level to where it was in early 2006. The 3 month on 3 month rate of change – generally a smoother indicator of the near term trend – dropped to 2.8% from 3.5% in October and 3.8% in September. This suggests that house prices are now rising at a more moderate pace than in the spring and summer months, when they experienced a very strong bounce from the early 2009 lows.
“The outlook for the housing market remains crucially dependent on labour market conditions, and here recent developments have been somewhat more encouraging than might have been expected. With the UK experiencing its longest and deepest recession since WWII, most economists expected unemployment to increase very sharply in 2009, perhaps breaching the psychologically important three million mark by the end of the year. While unemployment has indeed increased noticeably, the rise has not been as rapid and pronounced as previously feared. Based on the latest labour market figures from September, it now looks unlikely that the jobless total will reach three million before the year is up.”