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Halifax: Low October transactions produce 1.2% growth

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  • 07/11/2011
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Halifax: Low October transactions produce 1.2% growth
UK house prices increased by 1.2% in October, continuing a pattern of volatile monthly movements, the Halifax reported.

The sharp monthly gain still left house prices down 1.8% on the year and 0.3% on the quarter.

Halifax said that the housing market “proved resilient” in recent months despite the weak economic recovery and deterioration in the outlook for both UK and global economies.

The average home in the UK stands at £163,311, according to the index.

Halifax’s 1.2% monthly rise was the second largest since June this year and followed two monthly falls of 1.1% and 0.3% in August and September, respectively.

“The prospect of exceptionally low official interest rates over the foreseeable future is likely to continue to support the market in the face of a very difficult economic climate. Both prices and activity levels are expected to remain close to current levels over the coming few months,” Martin Ellis, Halifax’s housing economist, said.

Nicholas Ayre, director of UK buying agent, Home Fusion, added: “Forget the monthly figure showing a 1.2% rise, which is merely a reflection of the lack of transactions. The figure that more accurately reflects the market is the quarterly one, showing a fall of 0.3%.

“With such uncertainty surrounding the economy and unemployment, not to mention high inflation, it’s a surprise the market is proving as resilient as it is.

“More than anything, the market is being propped up by the prospect of low interest rates for at least another year, maybe even two.”

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