House prices in Britain rose at their slowest rate for five months in November after the Bank of England raised interest rates for the first time in nearly four years, figures from Halifax show.
Britain's largest mortgage lender said today that house prices rose a seasonally adjusted 1.0 per cent in November, leaving them 14.1 per cent higher than a year earlier.
That was slower than the revised 1.4 per cent monthly gain seen in October but still indicating strong activity in the housing market. The rise was the smallest since June when prices rose by only 0.6 per cent just before the BoE cut interest rates to a 48-year low of 3.5 per cent.
The BoE reversed its quarter-point July rate cut partly because it was worried that house prices were rising too fast, reckoning that the longer the boom went on, the greater the risk of a sharp correction in the future.
Halifax said the latest price increases were still significantly above the long-term average of 8.0 per cent year- on-year rises and suggested that the recent rate hike would do little to slow the housing market significantly.
It said the average homeowner is currently paying 13.6 per cent of their post tax income to support mortgage payments compared with an average of 21 per cent over the last 20 years.