View more on these topics

House prices rally in December but quarterly growth negative: Halifax

Data from Halifax shows that annual house prices rose 1.3 per cent in December, up from the comparative 0.3 per cent figure recorded in November, which was the lowest growth rate for six years.

On a monthly basis, prices grew 2.2 per cent, up from a drop of 1.2 per cent in the previous month. This movement results in the average house price standing at £229,729.

However, when measured on a quarterly basis, prices fell by 0.4 per cent compared to Q3 2018, which some industry observers see as a concern, including Housesimple.com’s chief executive Sam Mitchell, who comments: “Buyers and sellers alike are sitting on their hands and this is likely to continue during the first three months of the year until there is more clarity on the outcome of Brexit.”

Meanwhile, Halifax reports that the annual growth figure came within the 0 – 3 per cent range, “as we forecast at the start of the year,” according to Halifax managing director Russell Galley.

He adds: “In 2019, we’re expecting continued stability in house prices with between 2 per cent and 4 per cent price inflation. This is slightly stronger than 2018, but still fairly subdued by modern comparison. However, this expectation will clearly be dependent on the Brexit outcome, with risks to both sides of our forecast.

“This year, mortgage payment affordability is more difficult to predict. There are competing pressures with signs of positive annual pay growth supporting affordability, but risks associated with the potential for higher interest rates are pulling in the other direction. On balance we do not see affordability pushing house price growth significantly in either direction,” he says.

North London estate agent Jeremy Leaf comments: “At first glance the Halifax numbers are really positive as they reflect a time of particular political uncertainty and the height of Brexit turmoil. But when taken with the recent fall in transactions [when measured on a seasonally adjusted basis] it is clear that the increase has more to do with a shortage of stock rather than a bounce back in the market generally.”

Property Expert chief executive Andy Soloman says: “Somewhat of a shock result with the housing market staging one of the great, late comebacks in 2018, although a string of shoddy results means that prices are still down on a quarterly basis.

“While other external factors such as mortgage affordability and a lack of stock may continue to stimulate the market to a certain extent, we’ve already seen a number of inbound buyer and seller enquiries stating concerns over Brexit so far this year.

“This political rot is setting in at all levels of the market, not just the upper echelons and while largely restricted to London and the South East, this air of trepidation is likely to persist until the credits roll on the government’s comedic Brexit offering.”

Glenhawk chief executive Guy Harrington comments: “These latest figures continue to show that the UK housing market is resilient to external factors, as a combination of a chronic lack of supply due to a clunky and outdated planning system and the need for more starter homes continues to keep the market buoyant. Overall a positive sign amongst the train wreck that is Brexit.”

Recommended

Mortgage lending stable in November: BoE

Data from the latest report from the Bank of England, shows that the mortgage market’s stability seen since 2016 continued into November 2018. Households borrowed £3.5bn against their homes back in November, slightly lower than the previous month’s total of £4.1bn. This is in line with the average amount since 2016, £3.6bn per month, the […]

Life cover for life

Jennifer Gilchrist Proposition Lead – Design, Royal London When someone mentions whole of life plans, most people will think of a niche product that serves as an inheritance tax planning tool for high-net-worth clients. And it’s really not surprising they’ve been pigeonholed in that way because before the arrival of RDR in 2013, that’s more […]

Newsletter

News and expert analysis straight to your inbox

Sign up