Higher interest rates failed to deter buyers from moving into the property market in May with house prices rising by 1.9%, figures revealed today.
The difficulty facing first-time buyers was underlined by the fact that property in the UK is now 19.5% more expensive than a year ago, according to the Nationwide Building Society.
The average house now costs £149,020 - up 9% on the beginning of the year and increasing faster than the 5.8% growth during the same period of 2003.
The figures add to pressure on the Bank of England's monetary policy committee to follow the increase in the cost of borrowing to 4.25% earlier this month with another rate hike to cool the market down.
Nationwide expects interest rates to reach 4.75% by the end of the year, although many economists expect the cost of borrowing to be even higher.
Thursday May 27, 2004
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