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UK house price growth slowed in November, Nationwide says

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Growth in UK house prices slowed slightly in November, according to the latest survey from the Nationwide.

Prices were 3.7% higher than a year earlier, the building society said, down from 3.9% in October.

House prices rose by 0.1% in November from the previous month, and the average property now costs £196,305.

Nationwide said the annual rate of house price growth for the past few months had been broadly in line with earnings growth over the longer term.

"While this bodes well for a sustainable increase in housing market activity in the period ahead, much will depend on whether building activity can keep pace with increasing demand," said Nationwide chief economist Robert Gardner.

Regional differences

House price figures from the Land Registry show that values have risen in all regions of England and Wales in the 12 months to the end of October, but at very different speeds.

The sharpest rise was in London, where the annual price increase was 10.6%.

This pushed the value of the average home in London above £500,000 for the first time.

The slowest rise was in Yorkshire and the Humber, where prices rose by 1.4% over the year.

The most expensive sale in October was in Belgravia, London, at £21.5m. The cheapest was in Middlesbrough at £10,000.

Building

The Nationwide noted that there were a number of measures announced in Chancellor George Osborne's Autumn Statement to encourage building, but construction was well below the rate at which new households were formed and needed homes.

"It is positive that policymakers are focusing on the need to increase home building," Mr Gardner said.

Among the policies announced by the chancellor was a stamp duty surcharge on buy-to-let and second home purchases from April 2016.

Ray Boulger, of mortgage broker John Charcol, said the imbalance in the market between buyers and sellers would be greatly accentuated over the next few months, as anyone already thinking of buying a second home or a buy-to-let property would start looking more keenly.

"As buy-to-let represents over 15% of total housing purchases the tax changes are large enough to distort prices in an inelastic market," he said.

Howard Archer, UK economist at IHS Global Insight, said he expected house prices overall to increase over the coming months, with a rise of about 6%-7% during 2016.

Various surveys record UK house prices on a monthly basis, but they all have slightly different methodology.

The house price index by the Nationwide is the quickest to be released. It uses an average value for properties after considering components such as location and size. The survey is based on its own mortgage lending, which represents about 13% of the market.

The Land Registry calculates the price change for properties that have sold multiple times since 1995. This survey only covers England and Wales.

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