|M/M % change||0.3%||-0.1%||1.6%|
|Yr/Yr % change- 3 mo moving av||8.6%||8.5%|
UK house prices dipped 0.1 percent on the month in May according to the Halifax's new survey. However, the surprise fall, only the second since last October, followed an unrevised 1.6 percent surge in April and means that prices over the last three months were still some 2.0 percent above the previous period and 8.6 percent higher than a year ago, their strongest performance in seven months.
Despite May's minor setback house prices remain on a solid upward trend. In no small way this reflects tight supply conditions with the stock of available properties at a multi-year low and new instructions in April declining for the eighth time in the last nine months. As a result, relatively soft market activity has not prevented house price inflation from remaining well above earnings growth so far in 2015. Moreover, with market surveys suggesting that the end of general election uncertainly has provided a boost to demand, prospects are for more of the same over the rest of the year.
Halifax House Price Index is the UK's longest running monthly house price measure with data covering the whole country going back to January 1983. The Index is based on the largest monthly sample of mortgage data, typically covering around 15,000 house purchases per month, and covers the whole calendar month.
Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can damp housing starts. Changes in home values play key roles in consumer spending and in consumer financial health. During the first half of this decade sharply rising home prices boosted how much home equity households held. In turn, this increased consumers' ability to spend, based on wealth effects and from being able to draw upon expanding home equity lines of credit.
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