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House price rises reach a plateau

House price rises reach a plateau

Category: Mortgages

Updated: 15/03/2010
First Published: 15/03/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Rising property values appear to be levelling out, as asking prices increased by a mere 0.1 per cent in the first half of March, the lowest rise ever recorded in the month.

The average property asking price crept up by just £216 in March, from £229,398 to £229,614 – the lowest price rise ever recorded in the month, according to the Rightmove House Price Index.

While house price momentum has slowed in March thus far, the first quarter of 2010 has seen a gain of 3.7 per cent, adding over £8,000 to the average price of property, despite severe weather conditions at the beginning of the year.

The incremental upturn in prices has been blamed on a rise in supply of properties.

An improvement in the weather was attributed with a 34 per cent rise in sellers coming to the market compared with March last year, the highest new property supply since before the collapse of Lehman Brothers in September 2008.

Miles Shipside, commercial director of Rightmove, said: "The majority of property price indices will show some further rises this spring, as they reflect the recovery from the weather-induced dampener on turn-of-the-year sales and subsequent mortgage activity.

"This appears to have bucked up a few lenders' ideas too. More have decided to get competitive in the 10 per cent deposit arena, which powers the all important first time buyer (FTB) market."

Despite this, FTBs are still struggling to gain a foothold on the property ladder, according to figures. Over six in ten (61 per cent) of those in rented accommodation said they aspired to own a home but could not currently afford to do so.

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