House prices up 7% as demand for homes increases

Mortgage approvals up 30% as housing transactions top the one million mark

Alex Johnson
Thursday 06 February 2014 10:33 GMT
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Latest figures indicate that house prices rose 1.1 per cent in January.

Halifax's latest house price report indicates that house prices between November 2013 and January 2014 were 1.9 per cent higher than in the previous three months, and 7.3 per cent higher than the same period a year ago.

There were also more than one million housing transactions in 2013, the first time they have reached that mark since 2007, while home sales rose for the ninth successive month in December 2013 to 103,040, 30 per cent higher than in December 2012.

The number of mortgage approvals for house purchases between October and December was also 30 per cent higher than in the same three months of 2012.

"With the supply of properties being slow to respond to more buoyant market conditions, stronger demand has resulted in continued upward pressure on house prices," said Martin Ellis, Halifax housing economist. "Demand has increased against a background of low interest rates and higher consumer confidence underpinned by signs that the economy is recovering and unemployment falling faster than expected. Official schemes, such as Help to Buy, also appear to have boosted housing demand."

Nicholas Ayre, managing director of homebuying agency Home Fusion, said: "Buyers are considerably more optimistic than they were this time last year. Many are still concerned about the ‘bogy’ of an interest rate rise, although that is a tough call to tell when Mark Carney, governor of the Bank of England, will make his move. The same upward pressure on house prices is being felt, as supply constraints don’t appear to be ending anytime soon."

Mark Harris, chief executive of mortgage broker SPF Private Clients, commented: "Confidence among buyers is high with regards to their ability to get mortgage finance and their belief that house prices will continue to rise so they need to move sooner rather than later. Subsequently, estate agents and mortgage brokers have got off to an incredibly busy start as many buyers view this as the year when they will finally get on the housing ladder, or move up it, as long as they can find the right property."

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