House prices 2.6pc up over first quarter
According to the Latest Halifax House Price Index the quarterly rate of change increased for the third consecutive month. It is now at a similar rate to September 2014 (2.7%) prior to a marked slowdown in the last three months of 2014.
Prices in the three months to March were 8.1% higher than in the same three months a year earlier.
House prices increased by 0.4% between February and March, offsetting February’s 0.4% fall.
Commenting, Martin Ellis, Halifax housing economist, said: “House prices in the three months to March were 2.6% higher than in the previous three months. This measure of the underlying rate of house price growth increased for the third consecutive month in March.
“Annual price growth, however, fell slightly again, from 8.3% in February to 8.1%, and is comfortably below last July’s peak of 10.2%.
“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%.”
Guy Meacock, head of the London office for buying agency Prime Purchase, said: “This reflects a seasonal change you would expect to see at this time of year. As the weather improves, the housing market tends to shift as we move out of winter into spring.
“A change in light, longer daylight hours and the ability to view property after work all signals a seasonal shift where the market moves up a gear.
“There is also more hope and optimism around. As we move that much closer to the General Election, there seems to be an underlying confidence that David Cameron might get back in so although the mansion tax issue is not settled by any means, people are talking about it less.
“Indeed, no client has asked me about it this year, suggesting it is not on people’s minds.”
Jonathan Hopper, managing director of the buying agents, Garrington Property Finders, said: “Despite the ongoing slowdown in the annual rate of growth, we expect to see a slingshot in buyer activity in the months after the General Election, especially at the higher end of the market.
“There’s no doubt that the property market has come off the boil over the past six to nine months. However, demand is still there and, once the May Election is out of the way, we expect both buyer activity to pick up considerably and more property to enter the market.”
Jeremy Duncombe, director, Legal & General Mortgage Club and Housing, believes now is a good time to be buying.
“House prices have risen in March although the rate of annual growth has slowed since the end of last year,” he said.
“This shows that the market is levelling off after a sustained period of fast growth in 2014.
“However, the recent change in stamp duty rules and the low interest rates available at the moment mean that now is actually good time to be looking for a new home or mortgage deal despite any election uncertainty.”