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Friday, 6 December, 2002, 09:08 GMT
Slowdown in house price rises
Halifax annual house price graph
Britain's runaway house prices showed signs of steadying in November, according to the mortgage lender Halifax.

The monthly increase was significantly lower than the record rises in September and October

Martin Ellis, Halifax chief economist
It said prices rose at their slowest level for three months, but they were still almost 30% higher than the same period last year.

Figures from Halifax suggested November house prices rose just 1.4%, a marked slowdown from their jump of 4.7% in October.

The company said house prices were likely to continue their more modest gains and that low interest rates were maintaining momentum.

"With these favourable factors set to remain very much intact over the foreseeable future, house prices are expected to continue increasing, though at a slower pace than in recent months," said Martin Ellis, chief economist at Halifax.

First time crunch

Mr Ellis suggested first-time buyers were finding it increasingly difficult to keep pace with the price rises and that this would cause the inflation to slow in coming months.

Open in new window : UK property market
The house price boom

"The monthly increase was significantly lower than the record rises in September and October."

Nonetheless, he said the Bank of England's decision this week to leave interest rates on hold at 4% meant affordability remained "very good".

The Bank of England's Monetary Policy Committee saw Halifax's figures before deciding to leave interest rates at 4.0% on Thursday.

Despite the more modest rises in November, house prices are 29.2% than last year as borrowers have continued to take advantage of the lowest rates for 38 years.

According to Halifax's figures, the average house price is now 124,227 compared with 122,377 in October. A year ago, Halifax suggested the average house price was 92,262.

Earlier this month, rival mortgage lender Nationwide said house prices rose 2% in November, while a separate report by the Council of Mortgage Lenders (CML) said house prices would rise at a substantially lower rate next year.


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