03 Sep Nationwide: UK property values rise 3.5% year-on-year
Properties in the UK have risen in value by 3.5% from August 2012 to August 2013, according to latest figures from Nationwide.
The financial services provider released its House Price Index for August, showing property values increased by 0.6% from the previous month.
Robert Gardner, Nationwide’s Chief Economist, said property prices rose at a “fairly brisk pace” in August, with the average price of a house in the UK currently being £170,514.
He stated there are a number of reasons why there seems to be development in the property market, including an increase in confidence among homebuyers as a result in improvements in employment, as well as the increased availability of credit, enabling more people to access mortgages.
Despite this, Mr Gardner commented that demand for properties may begin to surpass the supply available, which will result in house prices being unaffordable by many property purchasers.
“While house prices are still elevated compared with incomes, affordability is being supported by the ultra low level of interest rates,” he stated, adding that first-time buyers (FTBs) typically take out mortgages that use up 29% of their disposable income.
This comes after the Council of Mortgage Lenders reported there has been a rise in the number of FTBs buying properties in the UK during the second quarter of the year, rising by 19% from Q1 2013.
The 11,200 mortgages that were advanced to FTBs during Q2 was also a 38% increased on the number given out during the same period in 2012.