House prices “bounced back”

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House prices “bounced back” in January with average values lifting to the highest levels seen since 2008, Halifax has reported.

Prices across the UK rose by two per cent month-on-month to reach £193,130 typically, which is the largest average value in cash terms seen since February 2008, Halifax said.

The two per cent uplift is the strongest monthly increase seen for January since 2009. House prices in the three months to January were also 1.9 per cent higher than they were during the preceding three months, marking the first time the quarterly change has accelerated since July last year. The year-on-year measure of house price change also grew stronger, with prices increasing by 8.5 per cent annually in January, up from a 7.8 per cent annual increase recorded in December, although this is still below a recent peak of 10.2 per cent year-on-year growth seen last July.

Martin Ellis, housing economist at Halifax, said the “bounce back” in house price growth may indicate that falling mortgage rates, an overhaul of stamp duty and the first real increases to earnings for several years are providing a modest boost to the market.

He added: “It is, however, too early to draw any firm conclusions. The monthly figures in January can be particularly volatile due to lower volumes of activity at this time of year and there have been unusually large rises on occasion in the past.”

The latest figures add to recent evidence that the housing market is starting to turn around after showing signs of cooling towards the latter half of 2014. The most recent regional figures from the fourth quarter of 2014 showed the average house price in Yorkshire and the Humber was £129,351 - a rise of 1.3 per cent on the previous year.