Newcastle Building Society has launched a new five-year guaranteed investment bond linked to growth in the property market.

The investment, which is based on the Halifax House Price Index, returns 110 per cent on any growth, while the capital is guaranteed.

Minimum investment for the plan is £1000, while the maximum is £1 million, with tracking beginning on September 29th 2006.

Any funds invested before this date will also benefit from an interest of £4.5 per cent.

Steve Urwin, head of marketing and new media at Newcastle Building Society, commented: Newcastle’s guaranteed property bonds have generally appealed to those who do not wish to invest directly in physical property, yet still desire the opportunity to benefit from any growth in the housing market.

Mr Urwin stated that the Halifax House Price Index reported a house price increase in May of 0.1 per cent, which brought the annual increase to up to 9.1 per cent, which he claims is the highest for 14 months.

Recent research from Moneyextra backed this, showing a 27 per cent rise in mortgage activity in May.