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House prices leap 7.7% in 12 months

Adam Williams
Written By:
Posted:
06/12/2013
Updated:
06/12/2013

UK house prices have risen by 7.7% in the past year according to the latest house price index from Halifax.

The average property price in the UK was £174,910 during September, October and November, almost 8% higher than the same period in 2012.

Property prices have been boosted by the return of consumer confidence to the housing market, partly thanks to government schemes such as Help to Buy.

Month-on-month house prices rose by 1.1% between October and November, the tenth consecutive rise, but Halifax said current levels are still 12% below the August 2007 peak.

The report commented both property sales and private sector housing starts had increased in the past year.

Halifax housing economist Martin Ellis said: “Stronger demand, combined with an insufficient increase in housing supply, has resulted in increases in house prices accompanying higher activity this year. Low interest rates, improvements in consumer confidence and official schemes, such as Funding for Lending and Help to Buy, all appear to have boosted demand.

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“However, continuing pressures on household finances, as earnings fail to keep pace with consumer price inflation, are expected to remain a constraint on the rate of growth of house prices. We are also seeing signs of a revival in housebuilding, which should help bring supply and demand into better balance and curb upward pressure on prices over the medium and longer terms.”

Alexander Gosling, director of the online estate agents House Simple, said: “Ten straight months of rising prices, and in some parts of Britain the housing market has gone from hot to hyper.

“With mortgages cheap and more available than ever, buyers are being spurred on by a seductive blend of confidence that prices will rise and fear that if they fail to pile in now they will be left behind.

“For now sellers are mostly resisting the temptation to ramp up asking prices beyond what the market will stand, with our figures showing that, nationally, properties are selling for 98% of asking price.”