UK house prices jumped by 1.4% in February, giving a three-month annual rate of increase of 5.5%, HBOS said today, further evidence that the property market is picking up again.
The bank's Halifax survey showed the biggest monthly rise since last August which more than reversed a decline of 0.4% in January. The annual rate of change was the strongest since May, showing a pick-up in property inflation from 5.1%.
But financial markets shrugged off the figures, with short sterling interest rate futures rallying strongly despite concern expressed by the Bank of England at its February meeting that lower interest rates could re-stoke the housing market.
The BoE's Monetary Policy Committee is widely expected to leave borrowing costs steady at 4.5% at the conclusion of its two-day meeting tomorrow and analysts said the data cemented even further those expectations. The nation's largest mortgage lender said the average price of a British home was a seasonally-adjusted £173,498 sterling in February.
House prices have more than doubled in Britain since the late 1990s, making it tough for first time buyers to get on the property ladder and leaving the majority of trading in recent years between current owner-occupiers.
