UK house prices edge up once again
Posted: 27 Mar 2006 11:03:51 GMT
House prices in the UK are continuing to rise, according to new research, with March seeing the biggest increase in 21 months.
Hometrack, a London-based research company, found that the average cost of a home in England and Wales has jumped up by 0.5 per cent this month, which is the biggest gain since June in 2004.
After weakening house prices throughout much of 2005, the Bank of England cut its benchmark interest rate in August and the effect has been significant.
Even during the traditionally slow Christmas period, activity in the housing market remained high, while the early months of this year have seen sustained growth.
The inevitable downside is that it is becoming increasingly difficult to get a footing on the property ladder and this is a particular problem in the capital.
According to the research, London house prices saw their biggest gain since August 2002 this month, with the average home now costing around £267,000.
While this month has seen the first annual increase since the beginning of 2005, the rise in house prices is only 0.1 per cent when compared to March 2005, leading many to suggest that the situation for first-time buyers could be much worse.
Richard Donnell, director of research at Hometrack, admitted: "A resurgent market in London, where prices grew by 1.1 per cent, has put something of a gloss on the headline results."