Interest rates bite house prices
Five interest rate rises in the last 12 months are beginning to rein in house prices, the latest research has said.According to Rightmove house prices rose 0.3 per cent in July, 0.5 points behind the growth experienced in June.The online property firm says that this is the lowest monthly rise its survey had recorded this year and contributed to annual house price inflation of 10.3 per cent.In June, house prices were revealed to have risen 13.2 per cent over the previous 12 months.Since August 2006 the Bank of England has raised interest rates five times, the latest quarter point increase coming earlier this month.The Bank's monetary policy committee (MPC) has been winning its war on inflation and consumer spending, but the UK's buoyant property market had proved to be a stubborn opponent.Rightmove's commercial director Miles Shipside however predicts that the market's "mini-boom is coming to an end"."As long as employment remains buoyant, prices are likely to remain broadly at these levels," he commented."However, depending on local supply and demand, sellers are going to have to duck and weave with their asking prices, especially if there is another rise in interest rates. This may be less likely now as there do seem to be further 'indicators suggesting a softening in the housing market' as referred to in the MPC's latest minutes."Today's survey, based on the measurement of 186,597 asking prices, also shows that the price-divide between London and the rest of the country is showing no sign of letting up, with the capital's houses recording an annual increase of 27.1 per cent in July.
Share this..
Related stories
Nationwide to charge customers using debit cards overseas
In a surprise move it has been revealed that the Nationwide is set to scrap the current 1% currency conversion charge on overseas Nationwide debit card transactions in favour of a 2% charge on all overseas transactions and a £1 withdrawal fee. However, the situation is slightly different for those holding Nationwide credit cards as the current 1% overseas charge will be retained for transactions...
Read MoreUK services sector under serious pressure
Over the last 30 years the UK has moved from a manufacturing based economy to a services based economy with literally millions of jobs created in the services industry. However, it has been revealed that for the ninth month in a row there have been significant job losses in the services sector and there are concerns that this could continue for some time to come. While there is one crumb of hope,...
Read MoreInvestigators looking into collapse of AIG
The collapse of American insurance giant AIG has become the subject of a serious fraud office investigation into the company's London branch. The collapse of the American giant was one of the largest in corporate history and many believe was the one main event which led to the collapse of the worldwide economy.
While the company itself was involved in all areas of the insura...
Big business finally waking up to financial restraints
A report by Deloitte LLP has today revealed that 50% of executive directors working at FTSE 350 companies in the UK will incur a further pay freeze in 2010 even though many also saw their remuneration frozen in 2009. Even those who are lucky enough to receive an increase in their remuneration in 2010 are unlikely to see an increase above 3%. After a period when executive remuneration did not se...
Read MoreBT challenges union strike ballot
Just hours before the Communication Workers Union was due to release the result of a strike ballot amongst BT employees the union was forced to call off the announcement after BT won a legal challenge questioning the legality of the action. It is unclear on what terms the strike action was challenged but a legal technicality would appear to have scuppered union plans to bring down BT in the short...
Read More