This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.bbc.co.uk/news/business-23090292

The article has changed 3 times. There is an RSS feed of changes available.

Version 0 Version 1
UK house prices rose again in June, says Nationwide House price gap between London and the UK 'widest ever'
(about 4 hours later)
UK house prices rose again in June, increasing by 0.3%, according to the Nationwide building society. The gap between house prices in London and the rest of the UK is the "widest it's ever been", the UK's third largest mortgage lender has said.
The Nationwide said the rise was helped by the government's Funding for Lending Scheme, designed to bring down the cost of credit, and improving job prospects. The Nationwide building society said prices in London were now 5% above their previous peak in 2007.
The annual rate of price growth rose to 1.9%, the fastest pace since September 2010. The increases means that the average house now costs £168,941. But prices across the UK as a whole are 9% lower than they were six years ago.
But Nationwide said there were few signs the housing supply was improving. Overall the Nationwide said house prices across the UK have risen by 1.9% in the past 12 months, the fastest pace since September 2010.
Robert Gardner, Nationwide's chief economist, said: "Demand for homes has been supported by further modest gains in employment, as well as an improvement in the availability and a reduction in the cost of credit, partly as a result of policy measures, such as the Funding for Lending Scheme. However, the national figure disguises huge variations in different regions of the country.
"Signs of a modest improvement in wider economic conditions may also be playing a role in boosting buyer sentiment." On average, anyone wanting to buy a house in London would need £150,615 extra, compared with buying in the rest of the country.
The Funding for Lending Scheme allows banks to borrow money at a discount from the Bank of England, providing they can show they have passed it on to customers in the form of loans. "For prices in the capital to be 5% above their 2007 peak is nothing short of incredible," said Jonathan Hopper of the property firm Garrington.
House prices in the second quarter of 2013, compared with the previous three months, were 0.4% higher, and up 1.4% compared with the same period a year ago. "The London property market is an extraordinary microcosm. It has effectively broken free of the rest of the UK and is operating in its own stratosphere," he said.
London was the top performer, with prices up 5.2% in the second quarter year-on-year. Prices are now 5% above their 2007 peak of £318,214, said Nationwide. East-West split?
However, annual price growth in Wales and Scotland continued to decline. Northern Ireland was the worst performer, with prices down 2.1% in the quarter from a year earlier. But the picture elsewhere is very different.
Meanwhile, Nationwide said that the supply of housing remained sluggish, with data showing a further decline in building activity. The region where prices are falling fastest is now Northern Ireland. House prices there have fallen by 2.1% in the past year, according to the Nationwide. Since prices peaked in 2007, they have dropped by 52%.
In the first quarter of 2013 housing completions in England were down 8% on the same three months in 2012, and are 40% below 2007 levels, Nationwide said. In Scotland, prices have fallen by 1.2% in the past year.
Even within England, there is huge variation between different cities. In Newcastle-on-Tyne, prices have risen by 11% in the past 12 months, the highest rise of any UK city.
But in Liverpool, prices fell by 8%, suggesting a possible east-west split, as well as a north-south divide.
However, prices in the south of England and East Anglia, are relatively close to their 2007 peak, the Nationwide said.
Lack of supply
UK house prices rose by 0.3% in June, the Nationwide said, pushing the price of an average property up to £168,941.
The Nationwide said the market had been helped by the government's Funding For Lending Scheme, which is designed to boost the amount of money that banks and building societies can lend out.
Robert Gardner, Nationwide's chief economist, said: "Demand for homes has been supported by further modest gains in employment, as well as an improvement in the availability and a reduction in the cost of credit, partly as a result of policy measures, such as the Funding for Lending Scheme."
But he also voiced concern about the rate at which homes were being built.
"There are few signs that the supply of housing is improving significantly. Indeed, construction data point to a further decline in building activity in recent quarters from already depressed levels," he said.
The most recent figures from the Halifax suggested prices are rising at a faster rate than that recorded by the Nationwide. Last month, the Halifax said prices had risen by 2.6% in the past year.