Buy to let house prices rise

03 June 2010

Written by David Whittaker

Buy to let and residential house prices have demonstrated a small increase this month, while the annual rate of property price inflation has declined, according to new figures.

Data compiled by Nationwide has revealed that the price of the average UK home increased by 0.5 per cent month-on-month in May, while the yearly rate of house price inflation fell from 10.5 per cent to 9.8 per cent.

Since their lowest point in February last year, prices have now demonstrated an increase of 12.2 per cent, with the average value of a property standing at £169,162 in May, compared with £167,802 in April.

Commenting on the figures, Martin Gahbauer, Nationwide's chief economist, said: "Since reaching a trough in February 2009 - following a drop of 19.3 per cent from their October 2007 peak - house prices have risen by 12.2 per cent and are now just 9.5 per cent below the October 2007 peak."

He added that the decline in inflation reflected the weaker pace of increase noted in May, compared with the corresponding month in 2009.

The news comes after the Land Registry recorded a 0.2 per cent rise in the average cost of a home during April - constituting an 8.5 per cent increase year-on-year.

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