New data revealed that house prices rose in the month of January as the outcome of December’s general election seems to have provided some political stability.
According to the latest Halifax House Price Index, house prices in January were 4.1% higher than in the same period a year prior.
The data also revealed that house prices rose by 0.4% on a monthly basis.
“Irrespective of political persuasion, the election result has provided us with a clear path ahead, which in turn has improved market sentiment,” Iain McKenzie, CEO of The Guild of Property Professionals, said in a statement.
“With signs of stability returning to the market, even if ever so slight, we are seeing the fires of the property market reignite, with activity once again on an upward trajectory which we anticipate will continue at a modest rate over the coming months,” the CEO continued.
Russell Galley, Managing Director at Halifax, also commented on the data: “A number of important market indicators continue to show signs of improvement. We have seen a pick-up in transactions with more buyer and seller activity consistent with a reduction in uncertainty in the UK economy.”
“However, it’s too early to say if a corner has been turned. The recent positive figures may actually represent activity that would ordinarily have been expected to take place last year, but was delayed by economic uncertainty. So while housing market activity has undoubtedly increased over recent months, the extent to which this persists will be driven by housing policy, the wider political environment and trends in the economy,” Russell Galley continued.
Commenting on the future, Russell Galley added: “Looking ahead, we still expect a moderate rate of house price growth over the course of the year. Demand is likely to continue to exceed the supply of properties for sale across the UK, with the subdued pace of new building also adding to upwards price pressure. The environment for mortgage affordability should stay largely favourable. However with the growth in rental costs accelerating, many first-time buyers will continue to face a significant challenge in raising necessary deposits.”