House prices 'rose by 3.3 per cent in 1993'

HOUSE PRICES rose by 3.3 per cent over the past 12 months, reflecting a modest upturn in the UK economy and the property market, according to figures released yesterday by the Nationwide Building Society, writes Nic Cicutti.

The figures also show house prices rose by 0.8 per cent in December and prompted predictions by the society of inflation-beating house price increases in the coming year.

Brian Davis, Nationwide's operations director, said: 'As the recovery continues, we expect confidence in the housing market to continue to improve in 1994. This should result in an increase in transactions, as buyers take advantage of the lowest interest rates for over 20 years.' A society spokesman said rises were expected to be up to 5 per cent.

Nationwide's prediction mirrors that of the Halifax Building Society, the country's biggest mortgage lender, which said last week it expected prices to rise by about 5 per cent in 1994. Halifax will announce its own figures for last year this week. They are expected to show a rise of about 1.5 per cent.

Gary Marsh, head of research at Halifax, said: 'Our figures in the past six months have tended to be quite consistent. They show that, whereas in the first half of 1993, prices were flat or falling, they tended to rise very slightly in the last part of the year.'