Published on : Thu, 01 Dec 2005 09:32GMT
by : Andy Clarke

LONDON - UK house prices remained flat in November, according to the latest figures form the Nationwide building society. This means that the annual inflation for the month was down to 2.4 percent from the 3.3 percent recorded in October.

Nationwide said that the average price of a home in the UK was £157,139. However, the house prices for the three months ending November had increased by just 0.6 percent. Nationwide had reported 1.3 percent rise in house prices in October and said that the trend was momentary and it would be wrong to judge that the housing market was returning to boom time.

This statement was repeated this time around as well, "As we expected, the strong rebound in prices in October was temporary, driven by buyers postponing purchases until after the August base rate cut," commented Fionnuala Earley, group economist at Nationwide. "The overall picture remains one of stability rather than acceleration."

But Britain's biggest building society said that November's data was on similar lines of data that was available in May. This data pointed to the fact that the housing market was settling down after the upheaval early in the year. "November's data suggests that the market has settled back down to the pattern of small rises in some months and small falls in others, with prices overall growing only very slowly," Ms Earley suggested.

Nationwide also scoffed at suggestions that the housing market was poised to crash, saying that it had had a "soft landing" and owed this in a big measure to the Bank of England's August rate cut. Nationwide pointed out that investor confidence was returning to the markets, "Estate agents are reporting increasing buyer interest and that buyers and sellers are reaching agreement on price more readily," Ms Earley said.

Analysts say that these figures do point to a revival of the market, but big movement could not be expected. Commenting on these figures, Howard Archer, the chief UK economist at Global Insight said, "This ties in with survey evidence from the Royal Institute of Chartered Surveyors, Rightmove and Hometrack showing that buyer interest is picking up helped by August's cut in interest rates."