HOUSE PRICES in England and Wales are no longer rising faster than inflation, according to the Financial Times house price index.
House prices nudged up by 0.1% in October, much less than the 0.9% monthly rise recorded a year earlier, says the paper.
Slower monthly price growth this October pushed the annual rate of house price inflation down from 3.3% in September to 2.5%. General price inflation in September, as measured by the consumer price index, was also 2.5%.
The housing market has been now been broadly stable for the past eight months, once seasonal factors are removed from the figures, with small monthly moves up and down. There are no signs of an imminent housing crash or renewed strength in the market.
The stagnation of prices, alongside a recovery in housing transactions, will please the Bank of England and the Treasury. It shows broad stability in one of the most important markets in the economy for the first time in almost a decade. As recently as August 2004, the annual rate of house price inflation was 15.2%.
There have been few signs of large price falls or rises in any region in recent months with house price inflation falling faster in the North of England, where it had been higher, and continued modest annual rises in most other regions.
Unlike the figures released by some mortgage lenders, the FT house price index has not been subject to volatile swings month by month. The Nationwide reported a 1.3% rise in prices in October after a 0.2% fall in September. In contrast, the Halifax said there had been no price rises in October after a 1.1% rise in September.
The volatility in other measures probably arise from the relatively small sample of housing transactions that any one lender uses. The FT says its index does not suffer the same sampling problems as it is based on all property transactions in England and Wales.
ROYAL LONDON, the mutual life and pensions company, saw new businesses in the past nine months grow across the board, reports the Scotsman.
New life and pensions business was up 20% at £170m, its Scottish Life subsidiary's new business rose 19% at £143m, while Bright Grey saw new business up 22% at £17m, said chief executive Mike Yardley.
Scottish Life International new business was up 26% at £10m.
BRITISH HEDGE fund Man Group yesterday won the auction for the futures brokerage business of Refco, the US group stricken by financial scandal last month, says the Guardian.
The deal came hours before Refco's ex-chief executive was indicted on eight counts of conspiracy, wire fraud and other charges.
Man is paying $323m (£186m) including the assumption of $37m of liabilities. The agreement includes the customer accounts and employees of Refco's regulated futures brokerage in the US, Britain, Canada and Asia. Refco was the largest independent futures and commodities broker in the US market. The acquisition still needs to be approved by the bankruptcy court. A consortium of creditors has filed an objection, asking for more time to assess the winning bid.
Refco burned out in spectacular style. The firm floated in New York in August, with its triumphant chief executive, Phillip Bennett, ringing the stock exchange's opening bell that day.
In October, the company disclosed that Mr Bennett had hidden $430m in bad debts in a company he controlled. Customers fled the firm in droves. A little more than a week later the business filed for bankruptcy and Mr Bennett was charged with securities fraud. Yesterday's indictment charged him with one count of securities fraud, one of conspiracy, three of making false filings with the US securities and exchange commission, and three of wire fraud. Prosecutors also contended that the 57-year old Briton should forfeit at least $700m. He has denied any wrongdoing.
Two of the three underwriters involved in Refco's $583m flotation have received subpoenas from US regulators to hand over documents relating to Refco. Credit Suisse Group and Bank of America have said they are cooperating.
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