Boris Bounce Begins?: bumper house price rise reported by the Halifax
House prices rose 4.0 per cent in 2019 according to Britain’s biggest mortgage lender Halifax, as a December bounce - some of it recorded after the General Election - saw the average property value jump £4,000.
Halifax’s figures are based on the lender’s own mortgage approvals and have been subject to some scepticism but Jeremy Leaf, the former RICS residential chairman who operates his own north London agency, says the index is “a reliable indicator of property market activity over many years so is widely respected.”
Halifax managing director Russell Galley says the 4.0 per cent rise over the past 12 months comes in at the very top of his prediction range for 2019.
He says: “This was driven by a monthly gain of 1.7 per cent in December alone, which was the biggest monthly increase of 2019, pushing up the year-on-year growth rate.”
And Galley continues: “Looking ahead, we expect uncertainty in the economy to ease somewhat in 2020, which should see transaction volumes increase and further price growth made possible by an improvement in households’ real incomes.
“Longer-term issues such as the shortage of homes for sale and low levels of house-building will continue to limit supply, while the ongoing challenges faced by prospective buyers in raising deposits will serve to constrain demand. As a result, we expect a modest pace of gains to continue into next year.”
Jeremy Leaf says the surge reflects a shortage of stock rather than a rise in demand, and is not found in the capital where affordability is most stretched.
“On the ground, there is no doubt that the election and more certainty on Brexit is contributing to recovery in market confidence. Looking forward, we expect higher increases in values in areas where the ratio of house prices to earnings is lower” adds Leaf.
Another agent - Marc von Grundherr, director of Benham and Reeves - welcomes the post-poll enthusiasm of the market.
Not only is this boost immediately evident within December’s monthly and annual top line growth, but those of us on the front line also enjoyed an almost immediate uplift in buyer interest and commitment to transactions. While mortgage affordability remains very favourable, we’ve also been promised an economic boost via the first Budget in four decades as a non-EU member state” he says.
And Ben Johnston, director of off-market property app Houso, comments: “Supply remains the key issue for the market, with the year’s 4.0 per cent price growth clearly underpinned by lack of stock.”
Credit - Estate Agent Today
Posted on: 14 January 2020