The Government must begin building more affordable homes as a matter of urgency, the union UNISON has demanded following the latest figures from the Nationwide Building Society showing a surprise rise in average prices.
 
House prices have bucked the recession to show a “surprising” rebound, the price of a “typical” UK house rising by 1.3 per cent in August, according to the Nationwide’s latest House Price Index. Prices remain 0.7 per cent lower than a year ago with a typical home now costing £164,729.
 
August’s rise is the largest monthly increase in prices since January 2010 and reverse declines recorded in the previous two months, according to Robert Gardner, the building society’s chief economist.
 
“Given the difficult economic backdrop, the extent of the rebound in August is a little surprising,” he said. “However, we should never read too much into one month’s data, especially since monthly price changes have been impacted by a number of one-off factors this year, such as the ending of the stamp duty holiday for first time buyers. These are factors that cannot be controlled by the usual process of seasonal adjustment.”
 
Nevertheless, in response to the figures, UNISON has called upon the Government to begin an urgent programme to build affordable housing; increasing the UK’s housing stock would not only ease pressure in the housing market, but would help turn the corner on the economic downturn, it said.
 
“The government needs to be bold to help our country recover from the recession. Initiating a programme of building affordable housing would stimulate growth and give thousands of low paid families the chance of a decent home,” said Dave Prentis, the union’s general secretary.
 
“But when the UK urgently needs affordable housing, the government has cut funding for social housing by more than £4 billion. What it could and should be doing is making capital funding available to housing associations and local authorities so more homes can be built as a matter of urgency.”