One of the UK’s biggest banks offered some positive news to home-owners and those trying to get on the property ladder today when it said prices will rise, but the cost of new mortgages will fall.
Its prediction that the Bank of England will cut rates three times by the end of the year, starting sometime in late summer, is consistent with earlier forecasts.
But it has changed its mind on house prices which it now expects to rise 1.5% this year, much better than a 2.2% fall previously predicted.
Chief financial officer William Chalmers said there is a “more benign economic outlook”, and that the housing market had proved more resilient than expected.
Lloyds forecasting is based on the Halifax House Price Index, which excludes figures for cash buyers, which currently made up over 30% of housing sales.
This was seen in contrast to an announcement from lender Nationwide, claiming UK house prices fell unexpectedly for the second month in a row in April reflecting the recent rise in mortgage rates.
