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News: Nationwide Announces Surprise House Price Rise

Fri, 29 May 09

House prices unexpectedly rose by 1.2% in May, according to latest figures from the Nationwide.

The building society puts the monthly rise down to a lack of supply in the market.

The price of an average home is now £154,016, according to the Nationwide, which added that the annual rate of decline is now 11.3%, a considerable improvement on April’s figure of 15%.

The fall in house prices over the last three months is now 0.5%, the lowest quarterly fall since the early last year.

The latest figures come in stark contrast to latest estimates by the Financial Services Authority that house prices could fall by as much as 50% from their 2007 peak.

Martin Gahbauer, Nationwide’s chief economist, said that despite the upbeat figures further price falls are expected.

He said: “During the downturn of the early 1990s, there were many months during which prices rose, only to fall back down again in subsequent periods.

 "In the current downturn, the combination of rapidly rising unemployment and tight access to credit implies that the last of the price declines has probably not been seen yet."


By Joe Lepper

See also: Home Asking Price Index, House Prices and Trends by Town and Postcode, Mortgages

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