U.K. House Prices Rise for a Seventh Month, Nationwide Says

  • Values increased annual 4.4% in January vs 4.5% in December
  • Prices may accelerate as job market strenthens and wages rise

U.K. house prices rose for a seventh month in January and a strengthening jobs market may inject momentum into property demand, Nationwide Building Society said.

The average price of a home climbed 0.3 percent from December to 196,829 pounds ($282,100), the lender said in a statement on Wednesday. The annual rate of growth was 4.4 percent in January compared with 4.5 percent the previous month.

Recent reports have pointed to a shortage of homes for sale, which is pushing up values. At the same time, the lowest unemployment rate in a decade, faster-than-inflation wage increases and low borrowing costs are supporting demand. The British Bankers’ Association said on Wednesday that mortgage approvals rose 19 percent in December from a year earlier.

“The risks are skewed towards a modest acceleration in house-price growth, at least at the national level,” Nationwide Chief Economist Robert Gardner said. With the labor market improving and “interest rates also likely to stay on hold for longer than previously anticipated, the demand for homes is likely to strengthen,” he said.

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In its monthly report, the BBA said gross home-loan lending increased an annual 24 percent in December to 12.4 billion pounds. Last year, total mortgage borrowing rose 6 percent to 137.8 billion pounds, it said.

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