House prices in the first three months of 2015 have been on a rebound from the decline in the last quarter of last year, the latest Halifax House Price Index shows.
Prices grew on a quarterly basis for the third consecutive month in March. In the first quarter of this year they were 2.6 per cent higher than in the fourth quarter of 2014. The rate of increase is close to the 2.7 per cent growth recorded in September last year before the cool down started.
Compared to a year ago, house prices in the first three months of 2015 rose by 8.1 per cent. The annual rate of increase thus continued to fall, from 8.3 per cent in February and 8.5 per cent in January.
There are other signs of stabilisation on the housing market, with the latest seasonally-adjusted HMRC figures showing a 2.5 per cent monthly increase in home sales for February Signs of a recent modest pick-up follow a steady decline during most of 2014 with sales in February still 8% lower than in February 2015.
There has been a recent uplift in mortgage approvals as well, according to Bank of England data. Approvals for home purchases, which are an important gauge for completed house sales, rose for a third consecutive month in February and the volume of mortgage approvals for the three months to February were 2 per cent higher than in the preceding quarter. This recent improvement follows five successive monthly falls in approvals between July and November 2014.
“The recent return to real earnings growth for the first time in several years, very low mortgage rates and last December’s stamp duty changes are supporting housing demand. The rising level of house prices in relation to earnings should, however, curb house price growth and activity. The annual rate of house price growth, which has continued to ease in the first quarter of 2015, is forecast to end the year at 3-5%,” Martin Ellis, housing economist, commented.
