Rising house prices 'surprise' MPC member
Rising house prices this year have surprised the Bank of England (BoE), according to a member of the monetary policy committee.
Kate Barker has told the Daily Telegraph that findings which show house prices are rising faster than earnings 'is a surprise'.
'In the very long run, it is difficult to think of house price growth being perpetually above earnings, unless there's something else going on, like a constraint on supply,' she said.
The Royal Institution of Chartered Surveyors (Rics) recently revealed that house prices rose for the fifth consecutive month in August. According to Rics, newly-agreed sales increased in August, while enquiries from prospective buyers accelerated.
Ms Barker also said that healthy economic growth has left the BoE feeling more comfortable about putting up the base rate. 'This doesn't seem like a situation where what you're most worried about is growth falling away,' she added.
Kate Barker has told the Daily Telegraph that findings which show house prices are rising faster than earnings 'is a surprise'.
'In the very long run, it is difficult to think of house price growth being perpetually above earnings, unless there's something else going on, like a constraint on supply,' she said.
The Royal Institution of Chartered Surveyors (Rics) recently revealed that house prices rose for the fifth consecutive month in August. According to Rics, newly-agreed sales increased in August, while enquiries from prospective buyers accelerated.
Ms Barker also said that healthy economic growth has left the BoE feeling more comfortable about putting up the base rate. 'This doesn't seem like a situation where what you're most worried about is growth falling away,' she added.
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