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June 30, 2010

House prices ease in June, say Nationwide

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by Kay Mitchell

House prices ease in June, say Nationwide

The latest house price index from the Nationwide Building Society has revealed a 0.1% rise for the month of June compared with May.

The latest house price gain means the annual rate of house price inflation fell to 8.7% from 9.8% in May, with the average UK home costing £170,111.

Commenting on the figures, Nationwide’s chief economist Martin Gahbauer, said: “Recent indicators point to an increase in the supply of property coming to the market for sale, perhaps in response to the abolition of Hips (Home Information Packs) in the opening days of the new coalition government.

“With the level of demand remaining broadly stable, this would in part help to explain the recent slowdown observed in the rate of house price inflation,” he added.

The figures come just a day after the Bank of England revealed mortgage approvals fell in May, suggesting the housing market will be subdued for the remainder of the year.

According to the Bank, mortgage approvals for the month stood at 49,815, a fraction below the 49,828 in April, and below analysts forecasts of 51,000.

Meanwhile, returning to house prices, many experts believe they will not continue their ongoing upward trend this year because new instructions are set to outstrip buyer demand.

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