House price inflation hits nine-year low

Figures released by the Office of the Deputy Prime Minister show that house price inflation hit a nine-year low in October.

It rose 2.2% in October from the previous year, compared to 3.3% in September.

House price inflation has been hovering in the range of 2-4% since July, as the market settles down after a marked slowdown since mid-2004.

The August interest rate cut and high employment levels have supported market conditions, with mortgage activity already back above its long-term average.

The Royal Institution of Chartered Surveyors expects the current upturn in housing market activity to be sustained into 2006 as the economy pulls out of last year’s slowdown.