House price growth continued to surge in November, with both Case-Shiller and FHFA reporting strong gains. At 11% y/y, the rise in the FHFA index is the highest since records began in 1992. But the current boom in house prices has eroded the boost in affordability provided by record low mortgage interest rates. We therefore expect annual house price growth will slow to around 3.0% by the end of 2021, which is slightly lower than consensus.
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