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House prices start year with rise House prices start year with rise
(about 2 hours later)
House prices rose by 1.2% in January compared with the previous month, according to the latest survey from the Nationwide Building Society.House prices rose by 1.2% in January compared with the previous month, according to the latest survey from the Nationwide Building Society.
The lift at the start of 2010 pushed up the annual increase in prices by 8.6%.The lift at the start of 2010 pushed up the annual increase in prices by 8.6%.
The Nationwide's chief economist, Martin Gahbauer, predicted that year-on-year prices would move above 10% in February.The Nationwide's chief economist, Martin Gahbauer, predicted that year-on-year prices would move above 10% in February.
The average UK home costs £163,481, following the ninth monthly property price rise in a row.The average UK home costs £163,481, following the ninth monthly property price rise in a row.
The three-month on three-month rate, regarded as a less volatile measure of house prices, saw prices rise by 2.1% in January, down slightly from 2.3% in December.The three-month on three-month rate, regarded as a less volatile measure of house prices, saw prices rise by 2.1% in January, down slightly from 2.3% in December.
Economic newsEconomic news
Mr Gahbauer said that figures which showed the UK economy had crept out of recession meant that UK house prices had "gone some way beyond the recovery in the overall economy". Mr Gahbauer told the BBC the rise was "surprising given the UK economy has been in the deepest recession since the 1920s".
Housing affordability had been affected by the fact that wages had not increased, and in some cases had fallen. He added that people were not putting their property on the market because low interest rates were acting as a disincentive.
Yet pay restraint had prevented more people losing their jobs and, in turn, having to sell their homes. "People may have a need to move house but may be on a mortgage that has a very low rate of interest, say 2.5% for some standard variable rate deals."
He said that could rise if a new mortgage was taken out for a home move.
Housing affordability has been affected by the fact that wages have not increased, and in some cases have fallen.
Yet pay restraint has prevented more people losing their jobs and, in turn, having to sell their homes.
The lack of supply in the housing market is one of the reasons why prices have continued to rise.The lack of supply in the housing market is one of the reasons why prices have continued to rise.