Asking prices for UK homes could rise 8 pct in 2014 -Rightmove
LONDON Dec 16 (Reuters) - Asking prices for houses in England and Wales could climb next year at their fastest rate since 2006, rising another 8 percent due to a shortage of homes on the market, property data firm Rightmove said on Monday.
Asking prices rose by an average of 5.4 percent, or 12,466 pounds, in 2013 and Rightmove said the expected acceleration in 2014 would be driven by an imbalance between sales and listings.
The number of housing transactions grew 13 percent this year against a rise in property listings of just 2 percent.
The Bank of England last month said it would end one of Britain's programmes aimed at stimulating mortgage lending and has said it will monitor the market amid fears of a bubble.
Rightmove said the Help to Buy programme, which provides government-backed low-deposit mortgages, did not appear to be fuelling a house price surge in London as feared and that most of the take-up so far had occurred in the north of England.
"Purchase prices are cheaper, and therefore it's easier for (people in the north) to afford the mortgage repayments on their incomes," Director Miles Shipside said.
Shipside noted that higher house prices in the south meant would-be buyers usually needed a bigger mortgage deposit of 10 percent or more to avoid punitive repayment rates, which in turn meant Help to Buy would not be beneficial to them.
"If you've got a 10 percent deposit or more, the rates are a lot better in the open market," he said.
Rightmove expected more transactions in 2014. Although listings are 30 percent lower than in 2007, before the financial crisis, the number of sales next year is set to climb to around 1 million, the highest since 2006, as lending restrictions ease.
An estimated 900,000 transactions took place in 2013.
Asking prices eased 1.9 percent in the traditionally weak month of December, the smallest fall since 2006.
JP Morgan economist Allan Monks said an 8 percent rise in house prices in 2014 could spur the BoE into fresh action.
"If you were to see the same kind of gains next year or something stronger than that, then you would see more action from the Financial Policy Committee which may go beyond fine-tuning at the edges," Monks said.
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