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UK February House Prices Highest Since 2008

UK February House Prices Highest Since 2008

House prices in the UK climbed for a second consecutive month to the strongest level in five years for the month of February amid a jump in volume of sales inquiries, a survey report from Rightmove showed Monday.

House prices rose 2.8 percent month-on-month in February to GBP 235,741. This was the highest price level recorded in February since 2008. In January, prices were up 0.2 percent.

Rightmove said that there were encouraging signs in the housing market with the property website showing record level of activity at the start of the year. The volume of enquiries in January also set a new record during the month.

On an annual basis, the house price index rose 1.1 percent after a 2.4 percent gain in the previous month. In London, home prices rose 1.2 percent on a monthly basis to GBP 486,890. This was 8.4 percent higher than last year.

"There has been a sprightly start to 2013 and, while market activity remains patchy across locations and property type, some agents are reporting their busiest new year since the onset of the credit-crunch," Rightmove's Director and housing market analyst Miles Shipside said.

"While encouraging, it's far too early to pop the champagne corks as certain sectors will remain on ice until the return of wider-spread mortgage availability," he added.

Shipside pointed out that the experienced 'old hands' who have built up equity through previous properties are at an advantage as they can raise the substantial deposits required by lenders.

Interestingly, they are often the ones who benefit most from the very low interest rates facilitated by the Funding for Lending Scheme (FLS), he added.

The survey revealed that 49 percent of those who intend to buy a home will be doing so for at least the third time. Meanwhile, the proportion of first-time buyers accounted for just 22 percent of all prospective buyers.

Traditionally, at the start of a new year, more new stock coming to market after the Christmas lull boosts activity. However, in recent years this has been tempered by the economic backdrop, Rightmove said.

The Royal Institution of Chartered Surveyors' (RICS) said earlier this month that home prices declined in January as bad weather kept potential buyers away from the housing market. Lloyds Banking Group's Halifax division also reported a fall in prices in January.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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