Halifax Reveals Surprising House Price Rise in March

Halifax has confirmed its data reveals a surprising rise in house prices for the UK in March. Its latest information confirms the average price rose by 1.5% last month when compared to February. This follows a lull in figures over the winter months of December and January. The average price reached £227,871 in March, although this does not tally with the latest figure revealed by rival lender, the building society Nationwide. Their latest average was revealed to be £211,625. This was a fall from the previous month – the second consecutive fall recorded by them. Can we rely on month-to-month figures? “While the headline data is surprising, Halifax did say the jump was probably due to natural month-to-month volatility in prices rather than anything else,” said Darren Pescod, CEO of The Mortgage Broker Limited. “When looking at fluctuations in house prices, the data produced on a quarterly basis is far more indicative of any ongoing trends in this area. “Furthermore, the monthly index from Halifax is known to experience large fluctuations that don’t represent the housing market’s general trends. Nationwide’s figures tend to be more reliable in this sense. Interestingly, Nationwide confirmed a drop of 0.2% in house prices for the same month.” Where does the quarterly picture leave us? Now we have completed the first quarter of 2018, we’re able to compare this with the final quarter of 2017. This reveals a drop in house prices of 0.1%. That’s the second decline in a row, according to this measure. “We can see it would be premature to celebrate an apparent rise in house prices between February and March,” Darren Pescod added. “I strongly suspect this is indeed merely volatility, and the figures from Nationwide present a far more logical and likely picture for us to follow. Home purchases are typically quiet at the beginning of the year anyway, with the prolonged winter providing every chance of this continuing. I would be surprised if we saw any notable increase in house prices this year.” How far could house prices rise during 2018? Experts vary on this. EY Item Club suspects only a mild 2% rise in prices will be seen across the entire year. Halifax gave a broader perspective at the start of the year, considering a rise would be in the 0-3% category.

Of course, this assumes an average rise across the UK. A Reuters poll taken around the beginning of the year, questioning more than two dozen housing specialists, revealed the consensus was for a 1.3% rise across the country. However, many believed prices for property in London would experience a slight fall, by 0.3%. Whether or not you will see price rises or falls this year may therefore depend on location. “Overall, we are not likely to see any huge surprises this year,” added Darren Pescod. “I would suggest even a 3% rise looks optimistic, although some regional areas of the UK may achieve it. Overall, we’re probably looking at a much lower figure.”

Published on 10 April 2018

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