House prices have recorded their strongest monthly increase since 2002, jumping by 3.9% in May and adding almost £7,000 to the average, according to figures from Halifax, the UK’s biggest mortgage lender.
Economists said they were surprised by the jump, with one describing it as a “bolt from the blue”, and cautioned against reading too much into one month of strong growth which followed two months of price declines.
However the figures are likely to increase pressure on the Bank of England’s financial policy committee to take action to prevent price rises becoming unsustainable.
The quarterly change reported by Halifax, which is a less volatile measure than month-on-month figures, showed a 2% rise in prices, the lowest level since January.
The index, which is based on mortgages approved by the lender during the month adjusted to reflect the price of a typical house and remove seasonal blips, put the average cost of a UK home at £184,464, some £15,000 below its 2007 peak.
via The Guardian
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