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House prices 'still rising'

27 October 2003
House prices have continued to rise during October, according to new figures.

Hometrack revealed that the number of sales agreed also rose during the same period and suggested that the growing threat of interest rate rises is failing to deter buyers.

The property website found that house prices in England and Wales increased by 0.4 per cent for the second month in a row during the four weeks to October 20th. The average price of a new home now stands £145,900.

The number of sales agreed rose seven per cent over the month, following a two per cent rise in September, Hometrack said.

Hometrack claimed that the latest rise was proof that the housing market has bounced back following a stagnant period over the summer and was gearing up for a strong run-up to Christmas.

Its findings have been backed up by data from the British Bankers' Association, which showed a record number of mortgages were approved during September. Recent housing market surveys from the Royal Institute of Chartered Surveyors (RICS) and property website, Rightmove, have also found that house prices are continuing to rise.

More sellers are achieving their asking price, and demand from potential buyers is shortening the time it is taking to sell properties, Hometrack said.

John Wriglesworth, Hometrack housing economist, said: "Expectations of rising interest rates are having very little adverse effect on housing demand with transactions continuing to increase across the whole country."

"Provided interest rate rises are modest - less than one per cent - the health of the housing market will remain robust."

Hometrack's figures showed that residential properties in Hereford and Worcester have experienced the largest price rises, with the cost of buying a home rising by 1.6 per cent on average, while just three areas experienced price falls - north west London, Buckinghamshire and Northumberland. Meanwhile prices rose by 0.7 per cent in London as a whole.