Halifax: Supply and demand imbalance fuels 9.7% house price growth

Halifax: Supply and demand imbalance fuels 9.7% house price growth

Data from the latest Halifax house price index has found that in the three months to February, the average price of a home was 9.7% higher than in the same three months a year earlier. The annual rate remains within the 8%-10% range where it has been for nearly the entire period since the start of 2015.

House prices during December-February were reported to be 3.0% higher than in the preceding three months.

House prices decreased by 1.4% between January and February. This offset much of January’s 1.7% rise. Monthly house price changes can be volatile. The quarter on quarter change is a more reliable indicator of the underlying trend.

Increase in areas where homes have risen more in value than owner’s total earnings. The increase in average house prices has exceeded total average employee’s net earnings in more than a quarter of local authority districts across the UK – 108 out of 380 (28%) – over the past two years, according to the report.

The data also highlighted that mortgage approvals were higher. The volume of mortgage approvals for house purchases – a leading indicator of completed house sales – increased by 5% between December and January. Approvals, at 74,600, were the highest since January 2014.  (Source: Bank of England, seasonally-adjusted figures)

Supply remains very low but signs of slight improvement. New instructions by home sellers increased in January for the second consecutive month. This contributed to the first rise in the stock of secondhand properties for sale for ten months.


Martin Ellis, Halifax housing economist, said: "House prices in the three months to February were 3.0% higher than in the previous three months whilst the annual rate remained unchanged at 9.7%.

Prices continue to rise at a robust pace driven by a significant imbalance between supply and demand. Whilst this position is likely to continue over the coming months, there are some tentative signs that the supply situation may be beginning to improve. Instructions for secondhand properties coming up for sale have increased in the past two months and the level of housebuilding increased significantly in 2015. Further ahead, increasing affordability issues, as house price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease.”

Russell Quirk, founder and CEO of eMoov.co.uk, commented: “There are slight signs that the UK market is cooling, with the February wobble seeing a decrease of 1.4% since January. However, this is only marginal as since November prices are up by another 3% and nearly 10% in the last year. Demand is always an influential factor where an increase in house prices is concerned, so the impending stamp duty changes due in April have no doubt helped to keep the UK market buoyant.

There has been a flurry of buyers keen to secure that second home or buy to let investment before the April deadline, as well as an increase in the stock available, due to savvy buyers looking to cash in and obtain a higher price than usual during this period of high demand.

We expect once the stamp duty dust has settled the market will cool slightly, but whilst UK and foreign buyers are still fuelling this increase, the issue of affordability will continue to take a back seat, rather than helping to restrain a continually inflating market.”

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SecomTech
SecomTech 19 Aug 2016

Firstly, I either lodge with DPS or do not take a deposit...secondly, If a tenant has not received a confirmation their deposit is secured with either a scheme or in an insured account with an agent/landlord,...

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jasonevans
jasonevans 19 Aug 2016

Belvoir has over 15 years of experience in property lettings, buying and renting and is one of the best agencies I know about. I have heard that they revived an award for the hard work. Really amazing...

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jasonevans
jasonevans 19 Aug 2016

Usually these areas are least affected when it comes to unexpected economical collapse.

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TheWaspNestRemover
TheWaspNestRemover 11 Aug 2016

You agree to pay for the treatment needed to get rid of fleas, ants, mice, wasps nests and other pests unless you can prove that these are a result of us not meeting our repairing responsibilities or these...

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madisonwelch80
madisonwelch80 02 Aug 2016

16% is quite a raise. Let's hope this tendency won't continue for long.

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madisonwelch80
madisonwelch80 02 Aug 2016

?66,963 is a serious price drop However buying a property it a serious investment only small percentage of the UK population could afford.

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madisonwelch80
madisonwelch80 02 Aug 2016

Wow, it kind of surprised me. I mean counting on mom and dad's bank even after retirement is too much. That's the moment in life when one should have ensured themselves. I am shocked.

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AbbieP.
AbbieP. 22 Jul 2016

"While house prices in the most expensive eleven boroughs have declined values in the cheapest eleven boroughs continue to rise" - not a nice way to even out the price range. London is overrated as it

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AbbieP.
AbbieP. 21 Jul 2016

And try to profit from your decisions, I may add

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CommercialTrust
CommercialTrust 19 Jul 2016

Retirement investment has always been one of the biggest draws of buy to let. And the buy-to-let demographic is, on balance, older. (Over a third of our applicants are over 50 at the time of application.) It...

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Forrest Wheatey
Forrest Wheatey 11 Jul 2016

I find the time perfect for ever home-owner wannabe. Prices should slowly, but steadily drop, at least for the inner buyer. Making it harder for outsiders to buy properties (the whole Brexit thing means...

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property guru
property guru 11 Jul 2016

Why should Ajay even have to be looking for it. It should be public knowledge. Why is not just publish each years and to were it is and be AUDITED. Accountability.

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