House price increase makes May rate rise ‘inevitable’
The growth of house prices this month has made a May hike in the base level of interest inevitable, it has been claimed.
So far, April has seen the average house price increase to £180,314 - a 0.9 per cent monthly change on March's £177,083, according to Nationwide.
In terms of annual change, the amount is 10.2 per cent above the level it was at in April 2006, it added.
And Fionnuala Earley, chief economist at the company, added that these statistics make an interest rise likely.
"The Bank of England held off raising rates at the beginning of April, but the acceleration in house price during the month makes a rate rise on the MPC’s tenth anniversary look like a certainty," she said.
An increase in the base rate may see people struggle to pay off debts and perhaps look to a loan to ease their financial burden.
It currently stands at 5.25 per cent - its highest amount since July 2001.
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