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9.7% rise for annual house price growth

Date online: 05/11/2015

Prices were also 2.8% higher than in the preceding three months, slightly above the average of 2.5% seen in 2015.

On a monthly basis, house prices rose by 1.1% between September and October, following last month’s fall of 0.9%.

Home sales increased by 1% between August and September, to 106,030 - the second successive monthly rise. Sales in the three months to September were 4.4% higher than in the preceding three months.

Mortgage approvals are also continuing an upward trend, despite falling in September. The volume of mortgage approvals for house purchases increased by 4% between Q2 and Q3 despite a 2.5% decline in September. Approvals in the three months to September were 10% higher than in the same three months last year.

Martin Ellis, Halifax housing economist, had this to say: "House prices in the three months to October were 2.8% higher than in the previous three months. This was slightly above the average of 2.5% on this measure over the first nine months of the year. The annual rate increased from 8.6% in September to 9.7%.

Improving economic conditions and household finances, together with sustained low mortgage rates, have boosted housing demand during 2015. Strengthening demand is filtering through in to higher sales levels although the ongoing shortage of supply is acting as a significant constraint on activity.

The imbalance between supply and demand is likely to persist over the coming months, maintaining upward pressure on house prices.”

Jeremy Leaf, former RICS chairman and north London estate agent, said: "As usual a national average house price has limited value, concealing significant regional differences. The fact that this snapshot is historic and records the actions of Halifax’s own customers also underlines its limitations.

That said, these figures are worrying as they suggest a continuing upwards trend which risks marginalising first-time buyers even further and is therefore not good for the health of the market. There is not enough balance in the housing market and there are still significant barriers to entry, despite lower mortgage rates.

If prices continue their upwards trend, it doesn’t bode well for those trying to get themselves into a new home early in the new year. Prices are high and supply low - that imbalance makes life very tricky for buyers. Those looking forward to welcoming in the new year in a new home might be struggling to achieve this unless they are prepared to pay for it."

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