House prices ‘rise unexpectedly’

Last month saw an unexpected boost to house prices, according to a newly released report.

In what may be good news for homeowners struggling with debt management or facing the threat of negative equity, Nationwide Building Society has found that property values picked up in March.

A rise of 0.9 per cent was recorded by the lender, a move that it described as a “surprise bounce” in the market.

And it revealed that buyer activity hit its highest level since May 2008, suggesting that interest in property is on the increase.

While the trend was welcomed by Nationwide chief economist Fionnuala Earley, she warned that more evidence is needed before talk of a recovery can be substantiated.

Although the Bank of England has brought in “strong measures” to aid the economy, Ms Earley predicted that “it will take time for these to work through into the housing market”.

Recently, the Council of Mortgage Lenders stated that a period of sustained improvement in the sector needs to be seen before a recovery can take place.

By Jamie Price