Bank of England's lending scheme fuels rise in Britain's house prices
Mortgage approvals hit 11-month high as central bank's credit-easing scheme begins to take effect
House prices in Britain rose last month as the Bank of England's credit-easing programme helped loosen the mortgage market, Nationwide Building Society said.
The average cost increased 0.5 per cent from December to £162,245 (HK$1.97 million), the customer-owned lender said yesterday. Prices were unchanged from a year earlier.
Separately, market-research agency GfK NOP said its index of consumer confidence also rose last month.
Data showed mortgage approvals rose to an 11-month high in December as the central bank's Funding for Lending Scheme eased conditions in the home-loan market. The bank is counting on the programme to encourage lending and provide a boost to an economy that is close to slipping back into a recession.
"The FLS has achieved some success in bringing down mortgage rates, with some signs of a pickup in lending activity," said Robert Gardner, chief economist at Nationwide. "Hopefully, the momentum will continue to build in the months ahead, though much will depend on whether the wider economic environment improves."
GfK's consumer-sentiment gauge rose to minus 26 from minus 29 in December. However, the survey was conducted before data were published last week showing the economy shrank 0.3 per cent in the fourth quarter, putting it on the brink of a triple-dip recession.