The latest data released by Halifax has shown that average house prices rose by 1.1% in April, clawing back some of the ground lost after a fall of 1.3% in March.
Halifax reports that house prices in the three months to April were up 5.0% when compared to the same three months a year earlier and 4.2% higher than in the preceding three months. The lender found that the noteworthy rise of 5% in April’s annual change figure comes against the backdrop of a particularly low growth rate over the corresponding period in 2018, impacting year-on-year comparisons.
Halifax adds that this also factored in a notably high growth figure recorded in February, driven by a higher volume of London sales and more expensive new build properties.
Russell Galley, managing director of Halifax, said: “The average UK house price now stands at £236,619 following a 1.1% monthly rise in April, as demand and supply of housing remained subdued for another month.
The index has seen a weaker pace of growth over the last three years, which is consistent with the easing of transactions volumes and housing market activity reflected in RICS, Bank of England and HMRC figures.
Looking further back, this April also marks 10 years since the lowest point of the Halifax house price index following the financial crash in 2008. Over the past decade annual house price growth has seen the average price increase by £81,956, or an average rise of 4.3% each year.”
As ever, the property industry was quick to react. Here's what they're saying:
Tomer Aboody, director of property lender MT Finance, had this to say: "These numbers are encouraging, reflecting that people are now coming to the conclusion that whatever will be will be with Brexit and they just want to get on with things. There is a positive attitude out there from estate agents to valuers to lenders - everyone is busier with transactions, just as you would expect for this time of year.
Those people who have been looking to buy for a while are now realising that the opportunity to move now is as good as any. Mortgage rates are extremely low and interest rates are unlikely to rise anytime soon, even though Mark Carney has been warning that it could happen in the future. Longer fixes are looking attractive for those families who need to move on and want some security from potential rate rises in a few years.
When we get to October and Brexit looms again, transactions will probably fall off again as jitters return. But for now, with Brexit kicked into the distance, people are transacting and getting on with their lives."
Jeremy Leaf, north London estate agent and a former RICS residential chairman, adds: "The Halifax survey is always respected, not least because of its longevity and breadth of coverage. These numbers are no exception but confirm what we are seeing at the coalface - a spring bounce but not as great as we might have expected.
The market is quite volatile, bearing in mind the fall in prices last monthThe price increases recorded are probably more to do with shortages of stock and lower transactions than sustainable market strength."
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: "The lack of supply and properties coming to the market is most likely continuing to support property prices, while cheap mortgage rates continue to attract those who are ready to take the plunge."
Lucy Pendleton, founder and director of James Pendleton estate agents, commented: “The blistering volatility of this index has returned as the Halifax house price weather vane spins itself into a frenzy once more.
The index has already come under scrutiny this year after months of erratic monthly growth figures. These can be more sprightly than the smoothed annual and quarterly numbers, but even so, they’ve been turning heads with the extremes with which they have been moving.
This time it’s the turn of quarterly and annual growth figures, which have leapt up. By this measure for April, the housing market is still comfortably making money for homeowners in real terms.
One explanation for ricocheting growth figures like this is persistently low stock levels. In sought after areas, this can lead to demand being supercharged one minute and gone the next, with price rises coming in waves as brief competitions for limited numbers of homes come and go. Even so, the Halifax index’s behaviour so far in 2019 has been unusual to say the least.”
Marc von Grundherr, Director of Benham and Reeves, commented: “Positive reading for the UK market and while a slightly erratic rate of annual growth may not be proof that we are out of the woods just yet, it certainly does demonstrate the much healthier position we find ourselves in now when compared to this time last year.
To say that demand for housing has subsided is misleading and not only have transactions remained consistent throughout the start of the year, but buyer demand remains prevalent, albeit more selective than it may have been previously.
Where the property market is concerned, London has been the driving force behind the recovery of the financial crash and while the capital may have paused for breath at present, it still offers by far the best investment options when looking at the UK market and will continue to do so moving forward.
Shepherd Ncube, founder and CEO of Springbok Properties, said: “We’ve now seen three consecutive months of positive quarterly and annual price growth and these more long-term indicators of market health suggest momentum is again starting to build across the UK property sector.
While current market conditions may not be ideal they certainly could be worse and ten years on from the market lows of the financial crisis it's important to remember this. When considered in this context, Brexit and the resulting market uncertainty has been a mere blip during an otherwise impeccable recovery for the UK market.
As we enter the spring and summer selling seasons this momentum will continue to build and regardless of how and when we leave the EU, the market will remain robust and continue to thrive despite all that’s thrown at it.”