Nationwide Reports Rise in House Prices in December

A recent report by Nationwide showed 0.4% increase in house prices in December 2010.The value of an average house at present is £162, 763, while it was £162,103 at the end of 2009.According to Nationwide, the prices are expected to fall during the first quarter of the new year.

Mr. Martin Gahbauer,chief economist, Nationwide, said that despite the increase in December, house prices had fallen several times in the past six months and it would be wrong to conclude that the recent downward trend was over. He agreed that the current downward trend was modest however. According to him the house prices would probably be stable in 2011 with a slow drift down trend.

The chief European economist of IHS Global Insight, Mr. Howard Archer said that the house prices would decline in 2011. “We continue to believe that house prices are likely to fall by around 6% in 2011, which would take them 10% below their 2010 peak levels, “he said.

Mr. Archer warned that if inflation remained above its 2% target, the Bank of England would raise the interest rate early in 2011.

The housing data released by other bodies showed a mixed picture. A report from Land registry revealed that the average house in Wales and England declined by 0.6%in November.

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