Houses prices up second month in a row
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Prices increased by 0.8 per cent in August, the fourth rise in the last eight months. But year-on-year figures are down by 10.1 per cent.
Halifax says prices have remained largely unchanged over the course of 2009 as a whole, with the average house price in August being £160,973, compared to £160,861 in December 2008.
The bank says the proportion of disposable income being devoted to mortgage payments has fallen over the past 21 months. Across the nation, typical mortgage payments for new borrowers have fallen from their peak of 48 per cent of average disposable earnings in the third quarter of 2007 to 29 per cent in august 2009. It says mortgage payments are now below the long-term average of 35 per cent relative to earnings, recorded over the last 25 years.
Halifax housing economist Martin Ellis says: “Demand for housing has increased since the start of the year due to better affordability and low interest rates. This, together with low levels of property available for sale, has boosted house prices over the last few months.”
Mortgages for Business managing director David Whittaker says: “It is encouraging to see another house price index indicating a recovery in the market. While it’s a marginal increase it’s the fourth monthly rise in eight months. But there’s the danger this fledgling recovery could stall before it has a chance to leave the start line. Low prices are tempting people back into the market and low stock levels are beginning to push prices up but there is still the problem of securing finance.”
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