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House prices leap 2.6% year-on-year

  • 06/06/2013
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House prices leap 2.6% year-on-year
House prices were 2.6% higher this May than the previous year in the biggest increase since September 2010, according to the latest Halifax House Price Index.

Prices showed steady growth – in the three months to May 2013 house prices were 1.5% higher than in the previous quarter and May house prices were 0.4% ahead of April. The average house price was £166,898.

Halifax housing economist Martin Ellis said: “”Market activity has also improved slightly in recent months although home sales remain low by historical standards.

“Despite these recent signs of improvement in the housing market, the subdued economic background and the accompanying weak income growth continue to be a significant constraint on housing demand and activity.”

The housing market gained a little more energy in the three months from February to April with sales activity 2% higher than the previous three months.

Property search consultants Garrington managing director Jonathan Hopper said despite strong month-on-month growth, the UK had two distinct housing markets: “In the capital, house prices are rising at a rate of knots and in some boroughs there has been a return to sealed bids.

“In many areas across the UK, sellers have to cut their prices to tempt buyers, and less desirable properties are languishing on the market for months.

“There’s a danger that if the London market collapsed it could set off a panic across the rest of the country. But the strength of demand for property in the capital, underpinned by overseas buyers, makes this unlikely.”

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