House prices in the UK are continuing to grow at a steady pace, the latest data has shown.
The Halifax Price Index revealed that houses cost 2 per cent more in the three months from March to May this year than in the previous three months and grew steadily at rates between 1.9 per cent and 2.3 per cent since June 2013.
Compared to the three months to May last year, prices were 8.7 per cent higher in 2014.
Home sales edged down by 1 per cent in April to 103,690, however, transactions are still a third higher than in April 2013. Annually, transactions grew to 1.142 million in the year to March 2014 – a rise of 23 per cent from the same period a year earlier, seasonally adjusted figures from HMRC (Her Majesty’s Revenue and Customs) proved.
Stephen Noakes, mortgages director at Halifax, said: “The quarter on quarter price change is a more reliable indicator of the underlying trend compared to the monthly price movement.
“On an annual basis housing demand is still strong and continues to be supported by a strengthening economic recovery. Consumer confidence is being boosted by a rapidly improving labour market and low interest rates, although growth in average earnings still remains weak.
“However, there are signs of a revival in housebuilding which should bring supply and demand into better balance and curb upwards pressure on prices over the medium and longer term.”
Brian Murphy, head of lending at Mortgage Advice Bureau (MAB), comments: “an annual house price increase of 8.7 per cent will be good news for second-steppers looking to climb the property ladder.
“Measured growth in house prices post-recession is good news, as it demonstrates the housing market is on its way to making a healthy recovery and prevents buyers from being stuck in an equity trap.
“However, this growth is likely to be skewed by the London property market, which is on its own unique trajectory. House price growth in the rest of the country is far more subdued, with ONS data indicating prices across the rest of the UK are still lower than they were pre-crisis.”
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