Pound surges after housing-market recovery pointer

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

Sterling rose around 1%, touching a near seven-month high of $1.6. It was boosted after mortgage lender Nationwide today said the average house price ticked up 1.2% in May to £154,016 - the second monthly increase in three months. Prices are up from a low of £147,746 in February but down 11.3% on May last year, and £32,000 below the peak of £186,000 in October 2007.

The annual rate of decline in the housing market has slowed from 15% in April, 15.7% in March and 17.6% in February.

Martin Gahbauer, chief economist at Nationwide, said it was "further evidence of some improvement in housing-market conditions over the last few months", but warned "it is still too early to say that the market is turning definitively".

Estate agents have reported a significant increase in interest from potential buyers this spring as low interest rates and price falls tempt people back into the market. Mortgage lending, while still low, has also staged a slight recovery from the dark days of last autumn and winter.

Howard Archer, chief UK economist at Global Insight, said the Nationwide figures will "obviously fuel speculation that the housing market may be turning".

But he added: "We remain highly sceptical that house prices have bottomed out. Activity remains very low and the pick up will be both gradual and fitful for an extended period given still very poor economic fundamentals and relatively tight credit conditions."

The 1.2% monthly rise was the second of the year. Prices were up 1% in March but down again in April having fallen for 16 months between November 2007 and February this year.

David Smith, senior partner of property consultancy Carter Jonas, said: "The rollercoaster ride for house prices continues. Up in March, down in April, back up in May. This volatility is typical of a housing market dragging along the bottom and mirrors the testing economic conditions."