Annual house price growth increased to 4.1 per cent in January, up slightly from the end of 2019, according to Halifax house price data released over the weekend.
In the latest quarter, house prices were 2.3 per cent higher than in the preceding three months says Russell Galley, managing director of Halifax.
“We have seen a pick-up in transactions with more buyer and seller activity consistent with a reduction in uncertainty in the UK economy. However, it’s too early to say if a corner has been turned” he cautions.
“The recent positive figures may actually represent activity that would ordinarily have been expected to take place last year but was delayed by economic uncertainty. So while housing market activity has undoubtedly increased over recent months, the extent to which this persists will be driven by housing policy, the wider political environment and trends in the economy” Galley adds.
Agents have of course been delighted with this latest sign of market optimism.
“When the country’s largest lender and provider of one of the most reliable house-price indices says the market is improving, you have to take notice. Halifax confirms what we have been seeing at the sharp end since just before the election - that there is a modest recovery under way” explains Jeremy Leaf, north London estate agent and a former RICS residential chairman.
“More demand, appraisals and offers but no fireworks as the market remains price-sensitive and the improvement patchy. We will probably only see if a more sustained uplift is underway if stock levels as well as the pace of sales increases - and developers come out of hibernation to acquire more sites” he adds.
Marc von Grundherr, director of lettings and sales agency Benham and Reeves, says this is evidence of the Boris Bounce.
“Given the months of market decline and the seasonalities involved, this turn around is really quite remarkable … We can now expect more of the same and we can look forward to a Brexit inspired bump in house prices now that we have finally departed and these green shoots will almost certainly be cultivated by the government with a further Budget boost come spring.”
And Iain McKenzie, chief executive of The Guild of Property Professionals, states: “Irrespective of political persuasion, the election result has provided us with a clear path ahead, which in turn has improved market sentiment. With signs of stability returning to the market, even if ever so slight, we are seeing the fires of the property market reignite, with activity once again on an upward trajectory which we anticipate will continue at a modest rate over the coming months.”
But Ben Johnston, director of off-market property app Houso, says more needs to be done to help the market, notwithstanding these improved figures.
“Portal costs, business rates, software costs and rent are constantly rising for local traditional agents, and the question has to be whether an average of 40 units on their books is sufficient to cover these overheads. More needs to be done to bring second steppers and downsizers to the market, perhaps a temporary levy of one per cent stamp duty across the board might encourage a move and help these demographics” suggests Johnston.