Hopes pinned on interest rate cut as market gets closer to stagnating.
House prices in England and Wales grew by just 5.43 per cent in the three months to June 2005, the smallest increase in almost 10 years. According to the Land Registry, whose data is based on actual completions, 216,890 sales were completed in the second quarter of the year – a drop in transactions of 27.7 per cent year-on-year. This is a marked improvement on the first quarter of 2005, when turnover fell by 35 per cent. The findings echo recent surveys from Nationwide and Halifax which also showed house-price inflation at low levels.
The average price of a house in England and Wales was £184, 192, with the biggest gains in Wales, where prices rose 10.4 per cent. Experts are predicting that the Bank of England's interest rate cut last week – of 0.25 per cent to 4.5 per cent – could stop the market stagnating.
The Royal Institution of Chartered Surveyors (RICS) said the cut would lead to "a modest improvement in the second half of the year as consumer confidence returns".