Surging house prices 'signal the start of a fresh boom'

The housing market is on the brink of a new boom, according to reports today showing London prices rising at the fastest pace since Labour came to power and the sales volume hitting record levels across the UK.

Central London property prices grew by 23.5 per cent in the 12 months to September 2006 - the highest rate since June 1997, the previous peak marked by Tony Blair's first election victory.

Hometrack, a property website, said UK price rises had hit a two-year high of 4.3 per cent while another report showed that a record number of homes changed hands in September.

The reports will heighten speculation that the Bank of England will raise interest rates to curb the boom in November - but perhaps as soon as this week.

Full Article on Independent.co.uk

By Philip Thornton, Economics Correspondent
Published: 02 October 2006