Friday, May 27, 2011
House prices, consumer confidence up
Posted by David Smith at 08:45 AM
Category: Thoughts and responses

The Nationwide Building Society said house prices rose by 0.3% in May, more than reversing their 0.2% fall in April, for a rise of 0.6% over the latest three months. Prices in May were, however, 1.2% down on a year earlier. Turnover remained weak and Nationwide said: “Overall, the modest pace of house price growth in May suggests that the property market is continuing to mirror the lacklustre trends evident in the wider economy." More here.

More impressive was the bounce in consumer confidence reported by GfK-NOP. It jumped 10 points in May to -21, prompting Nick Moon of NOP to say: “We have seen an almost unprecedented jump in consumer confidence this month. May’s figures show the second largest rise ever – only May 1993 was higher, when it improved by 12 points. In the 449 months that the index has been running, single-month movement on this scale – either up or down – has only occurred on ten occasions.". This could be significant. The weakness of consumer confidence this year has been a big concern for policymakers.