UK house prices reached a new record high
UK house prices in the last three months to March grew by 1.5% pushing the average price to a new record high of £227,871, according to the latest house price index of Halifax.
Russell Galley, Managing Director, Halifax, said:
“House prices in the three months to March were largely unchanged compared with the previous quarter. The annual rate of growth continues to be in a narrow range of under 3%; though the average price of £227,871 is a new high.
“Activity levels, like house price growth, have softened compared with a year ago. Mortgage approvals are down compared to 12 months ago, whilst home sales have remained flat in the early months of the year. This lack of direction in the housing market is in stark contrast to the continuing strength of the UK jobs market. The unemployment rate is now the joint lowest since 1975 and in the three months to January there were 402,000 more people in work compared to a year earlier.
“In the coming months we expect price growth to remain close to our prediction of 3% despite the very positive factors of continuing low mortgage rates, great affordability levels and a robust labour market. The continuing shortage of properties for sale will also support price growth.”
The key facts of the housing activity since the start of the year
UK home sales start the year on a flat footing. Home sales in February reached 101,000, the same as in January. In the three months to February home sales were only marginally lower than in the same period a year earlier. (Source: HMRC, seasonally-adjusted figures)
- Mortgage approvals for house purchases contracts by 5% in February. After the sharp rise in number of mortgage approvals – a leading indicator of completed house sales – in January, they fell by 4.8% in February to 63,910. Compared to the same time a year ago, approvals are down by 7%. (Source: Bank of England, seasonally-adjusted figures)
- Market activity still very subdued. There are no signs that the acute shortage of stock of homes available for sale is easing. The number of new instructions has now fallen for 24 consecutive months – the worst sequence for nine years, with the figure for unsold stock at a record low. For the eleventh month in succession new buyer enquiries have also fallen. (Source: Royal Institution of Chartered Surveyors’ (RICS) monthly report)
- Mortgages in the UK have reached their most affordable level in a decade, new research from Halifax has revealed. Typical mortgage payments accounted for less than a third (29%) of homeowners’ disposable income in the fourth quarter of 2017 compared to almost half (48%) in 2007 (Quarter 3). This fall in the burden of mortgage payments has helped improve affordability for homeowners – driven predominantly by historically low mortgage rates, despite the first base rate rise in a decade last November.