House prices increased by 0.67% during Q1 of 2011 to reach £197,153 reported Azzetz House Price Watch (AHPW) today.
Their index is based on house price information from Nationwide, RightMove, CLG and LSL Acadametrics - shows property values have risen by an average of £1,305 over the last three months.
AHPW stated house prices fell by 0.5% compared to Q1 2010, but the three-month annualised average rate of growth is now 2.98%.
Chief executive Stuart Law at AHPW stated “UK house prices have shown resilience in the face of the government’s spending cuts, recouping losses witnessed at the end of 2010 in the first few months of this year.”
“We expect prices to continue to increase in Q2 in line with a number of new mortgage funding schemes and good news stories regarding the economy.”
Mr Law stated recent falls in the rate of inflation & unemployment have helped to boost consumer confidence, which, combined with limited housing supply and improving mortgage finance, will continue to push house prices upwards this year.
Law believes the Bank of England to raise interest rates by 0.25% in the next few months. “The slight increase in mortgage repayments as a result will have a negligible impact on homeowners and prospective buyers who will continue to benefit from historic low rates.”
“Interest rates are unlikely to exceed 1% this year in order to compensate for recent tax increases and spending cuts. These low rates will continue to support house prices and consequently, unlike many commentators, we still expect values to increase by around 5% this year.”
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