Hopes of recovery mount, as house prices increase - Mortgages - News - Moneyfacts


Hopes of recovery mount, as house prices increase

Hopes of recovery mount, as house prices increase

Category: Mortgages

Updated: 05/08/2009
First Published: 05/08/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Hopes of a property market revival have been boosted once more, with newly published figures showing that the average price for homes in the UK increased by over one per cent in July.

The 1.1 per cent rise is the second improvement in property values in the last three months, according to the Halifax's house price index.

Prices in the three months to July, which are considered an indicator of long term trends, grew by 0.8 per cent compared to the previous three months – the first quarterly improvement since October 2007.

The average price of a home in the UK is now £159,623, which represents a contraction of 12.1 per cent over the last 12 months.

However, the market has clearly stabilised in 2009 thus far, with a fall of just 0.8 per cent since December 2008, when the average price for property was £160,861.

The house prices to earnings ratio – considered a key affordability measure – has also eased, falling from a high of 5.84 to an estimated 4.36 last month, with the long term average of 4.0.

"Demand for homes has risen, albeit from a very low base, since the start of the year, driven by improvements in affordability and low interest rates," said Martin Ellis, Halifax's housing economist.

"Higher demand has combined with the low levels of property available for sale to boost sales activity from exceptionally low levels and support prices over the past few months."

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Does your mortgage lender owe you money?

Earlier this week, the financial watchdog revealed that hundreds of thousands of mortgage holders could have been overcharged by their lender. Are you one of the many who could be in line for a windfall?

Do you think your home will rise in value?

There’s been a lot of talk recently about the rate of house price growth slowing, but is it affecting your personal expectations? According to research, it could be, with fewer people now expecting the value of their property to increase.

Confidence among “second steppers” is on the rise

We all know how difficult it can be taking that first step on the ladder, but what about the second step? In many cases, getting onto the next rung can be just as challenging, but happily, confidence among this cohort appears to be on the rise.