House prices rise more than forecast

LONDON Thu Mar 1, 2012 7:13am GMT

A brass door knocker is pictured on a blue door in London August 30, 2011. REUTERS/Luke MacGregor

A brass door knocker is pictured on a blue door in London August 30, 2011.

Credit: Reuters/Luke MacGregor

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LONDON (Reuters) - House prices rose more than expected in February, data from mortgage lender Nationwide showed on Thursday following other recent economic news that suggested the economy had found a path back to health.

Nationwide said that house prices ticked up by a seasonally adjusted 0.6 percent on the month - the biggest rise since April 2010 - and were 0.9 percent higher than a year earlier. This follows a surprise monthly fall in January.

Economists polled by Reuters had expected prices to edge up by 0.2 percent on the month and by 0.4 percent on the year.

"It remains to be seen whether this trend will be sustained," said Nationwide's chief economist Robert Gardner.

He added that, given the "challenging" economic backdrop, the housing market may have been boosted temporarily by relief for first-time buyers from stamp duty tax charged on land and property transactions, which expires in late March.

"If so, this may continue to support activity and prices in the near term before cooling over summer."

(Reporting by Olesya Dmitracova; editing by Ron Askew)

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