BERLIN, Feb 15 (Reuters) - German residential property prices rose in the fourth quarter, data showed on Tuesday, driven by the country's economic recovery and improving labour market.
Prices for owner-occupied housing rose 1.5 percent year-on-year, figures from the VDP association of German mortgage lenders showed, after posting a 1.4 percent increase in the previous three month period.
The growth was the strongest increase since the fourth quarter of 2008 and represented a 0.6 percent rise on a quarter-on-quarter basis.
"Against the background of favorable developments in the labour market, we expect prices for owner occupied dwellings to post a further moderate rise," VDP General Manager Jens Tolckmitt said in a statement.
German economic growth slowed in the fourth quarter, dragged down by cold winter weather but supported by trade, flash gross domestic product data showed earlier in the day. [ID:nLDE71E09Y]
Germany has a higher proportion of renters compared with other countries in Europe. Residential real estate prices expanded only moderately over the last decade but largely avoided the volatility of other markets like Spain or Britain.
The VDP data, based on rents and purchase prices from over 500,000 single-family homes and apartments, shows prices have risen over 8 percent since 2003.
Further data and charts from VDP can be found at: here (Reporting by Brian Rohan)