British house prices climbing

British house prices jumped in the three months through May at the fastest annual pace since June 2003, HBOS said, sending the British pound close to a nine-week high on expectations interest rates may rise as early as Thursday.

The average cost of a home grew 20.4% from a year ago to €236,121 in May, said HBOS, the nation’s biggest mortgage lender. Prices rose 2.2% from April. Home prices have surged in Britain, the US, Australia and Spain, fuelling concern among policy makers that property markets may slump as central banks raise lending rates to curb inflation.