House prices rose 0.5% in December, according to Nationwide, suggesting that the UK residential market is marginally strengthening.

Overall property prices in the UK rose by 3% in 2005, compared to 12.7% in 2004. Prices in 2006 are expected to increase by 0-3%

Commenting on the figures Fionnuala Earley, Nationwides Group Economist, said: “After a 0.5% increase in prices in December, house prices in 2005 were 3% higher than at the end of 2004, in line with our forecast this time last year. House price growth strengthened slightly in December, up from a 0.3% increase in the previous month.”

Equities outperformed residential property prices for the first time since 1999. The FTSE 100 grew by 16% in 2005 compared to housing market growth of 3%. However the FTSE still remains 10% below its 1999 level, whereas house prices have more than doubled during the same period.








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