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Financial Mirror (Cyprus) - - FRONT PAGE -

House prices rose at the slow­est an­nual rate in the U.K. in more than a year as the prop­erty mar­ket con­tin­ued to lose mo­men­tum across the coun­try, ac­cord­ing to mort­gage lender Na­tion­wide.

House prices rose 7.2% in the year to De­cem­ber, the small­est an­nual in­crease since Novem­ber 2013 and slow­ing for a fourth con­sec­u­tive month.

Hous­ing mar­ket ac­tiv­ity and price rises have been slow­ing since the mid­dle of the year, in part be­cause of steps by reg­u­la­tors to re­quire lenders to make tougher checks on bor­row­ers’ abil­ity to re­pay mort­gages. Still, house price growth in the three months to De­cem­ber rose 1.0%, from 0.9% in the pre­ced­ing three months. Although an­nual house price growth cooled in 12 out of 13 re­gions, Na­tion­wide said it ex­pected the mar­ket to re­cover next year.

“If the eco­nomic back­drop con­tin­ues to im­prove as we and most fore­cast­ers ex­pect, ac­tiv­ity in the hous­ing mar­ket is likely to re­gain mo­men­tum in the months ahead,” said Robert Gard­ner, Na­tion­wide’s chief economist.

“There are en­cour­ag­ing signs that con­struc­tion is start­ing to pick up. Hope­fully, this will set the stage for house price growth grad­u­ally con­verg­ing with in­come growth in the quarters ahead.” Gard­ner added that re­cent changes to the stamp duty land tax could also help to stim­u­late the hous­ing mar­ket.

While Bri­tain looks set to be one of the fastest grow­ing ma­jor in­dus­tri­alised economies this year, wage growth is still very weak, mak­ing houses hard to af­ford for many work­ers.

The Bank of Eng­land is also ex­pected to raise in­ter­est rates late this year for the first time since 2007.

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