UK House Prices Rise to Four Year High at 9.9%

UK house price inflation has hit a four-year high, according to official figures that will intensify the debate about whether policymakers need to take steps to cool the market.

The average UK house price rose by 9.9% over the year to April, up from 8% inflation in March, driven largely by increases in London, the Office for National Statistics (ONS) said. That was the strongest rise since June 2010.

The figures were released as members of the Bank of England’s financial policy committee (FPC) meet to discuss risks to the UK’s financial system, with house prices expected to be a key point of discussion. Last week the chancellor, George Osborne, gave the committee new powers to curb house price rises, which have been flagged as a threat to Britain’s economic recovery by ratings agency Fitch and the International Monetary Fund.

The ONS said house prices were increasing strongly across most parts of the UK, with prices in the capital again showing the highest growth. London prices rose 18.7%, the biggest increase since July 2007.

The rise in house prices contrasted with separate official figures showing inflation falling to a five-year low of 1.5% in May.

via The Guardian

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