STRONG GROWTH SAYS THE HALIFAX
HOUSE PRICES STILL ON THE UP – HALIFAX
forecasts growth of up to 4% this year
JANUARY 9, 2019 | MARC SHOFFMAN
House prices ended the year up 1.3% annually, according to Halifax figures.
The lender’s House Price Index for December showed the market grew within the 0-3% that it forecast at the start of 2018.
Prices were also up by 2.2% – on a monthly basis after 1.2% the month before – leaving average values at the end of last year at £229,729.
It comes after house price growth hit a six-year low in November at just 0.3%.
Russell Galley, managing director at Halifax, said: “A stronger monthly growth figure for December improved from a weaker November. Overall, house price growth in 2018 was very much within the range of 0-3% as we forecast at the start of the year.
“In 2019, we’re expecting continued stability in house prices with between 2% and 4% price inflation.
“This is slightly stronger than 2018, but still fairly subdued by modern comparison.
“However, this expectation will clearly be dependent on the Brexit outcome, with risks to both sides of our forecast. Of course, there are a number of other factors that will impact the market in 2019.”
Galley said the need to raise a significant deposit still acts as a restraint for those looking to buy a new home, limiting the number of potential purchasers.
He said: “This year, mortgage payment affordability is more difficult to predict. There are competing pressures with signs of positive annual pay growth supporting affordability, but risks associated with the potential for higher interest rates are pulling in the other direction.
“On balance we do not see affordability pushing house price growth significantly in either direction.
“The shortage of homes for sale and continuing low levels of house-building both constrain the supply of houses, and in turn support high prices, which will continue to inhibit demand in 2019.”
Commenting on the figures, Lucy Pendleton, founder director of independent estate agents James Pendleton, said: “The country has marched gamely up to Christmas and, with three months to go before Brexit, is refusing to blink.
“Last month there were fears the Brexit switch had been flipped as house price growth plumbed six-year lows.
“It looked for a moment like the UK could have dived for cover into wait-and-see territory in November after a year in which Brexit appeared to cast a remarkably short shadow at times. However, these figures breathe new life into claims Britons think this storm can be weathered.
“The imminent prospect of the UK’s most traumatic geopolitical lurch back in time is simply failing to tame buyer confidence, which is proving to be remarkably resilient.