Housing boom goes on

FIGURES due this week are expected to show little let-up in the housing boom. Inland Revenue data for property transactions last month are likely to ease fears of an imminent crash in home values.

Figures from Deputy Prime Minister John Prescott's office last week showed that house price inflation in the year to February rose to 10.5%, from ten per cent in the year to January.

The Revenue figures, unlike those for mortgage advances, take account of the 25 per cent of housing sales represented by cash purchases.

Prescott's figures for February contradicted suggestions from other industry sources of a sharp slowdown or even a standstill in the rate of price increases.

Though its annual 10.5% rise was below the February figure of 12.1% from Halifax, the fact that it rose rather than fell on the annual figure to January is considered significant. By contrast, Halifax had recorded an annual increase of 13.7% in the year to January.

While the figures from Prescott's office are compiled separately from the Revenue data, due on Thursday, they are thought to move in roughly the same direction.

Alex Bannister of Nationwide building society said the disadvantage of the Revenue's figures was that they excluded Scotland, but included some business property transactions.