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DCLG confirms January house price boom
16-03-2010 09:23
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House prices jumped 2.2% in January, according to the Department for Communities and Local Government, with low interest rates and affordable prices driving growth.
The annual increase leapt to 6.2%, up from 2.9% in December and just 0.5% the month before, the first positive read since the middle of 2008.
An average home cost £207,159 in January following the ninth monthly increase in a row. That's almost 11% higher than the low of £187,193 in March last year.
But the information is at odds with more recent updates from the Halifax and the Nationwide revealing prices fell for the first time in months during February.
"The lagging nature of the DCLG data means that it does not fundamentally alter our belief that house prices will be erratic and prone to corrections in 2010, and will probably be no better than flat over the year," said Howard Archer, chief UK economist at IHS Global Insight.
"Indeed, we would not be surprised if house prices recorded an overall modest drop this year," he adds. "This view is further supported by a series of recent survey data and hard evidence showing pretty sluggish housing market activity so far in 2010, which seems to be only partly due to the arctic weather at the start of the year."
The annual increase leapt to 6.2%, up from 2.9% in December and just 0.5% the month before, the first positive read since the middle of 2008.
An average home cost £207,159 in January following the ninth monthly increase in a row. That's almost 11% higher than the low of £187,193 in March last year.
But the information is at odds with more recent updates from the Halifax and the Nationwide revealing prices fell for the first time in months during February.
"The lagging nature of the DCLG data means that it does not fundamentally alter our belief that house prices will be erratic and prone to corrections in 2010, and will probably be no better than flat over the year," said Howard Archer, chief UK economist at IHS Global Insight.
"Indeed, we would not be surprised if house prices recorded an overall modest drop this year," he adds. "This view is further supported by a series of recent survey data and hard evidence showing pretty sluggish housing market activity so far in 2010, which seems to be only partly due to the arctic weather at the start of the year."
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