UK house price rises accelerating, says Halifax

Sold sign

House prices are continuing to accelerate across the UK, according to the latest snapshot from the Halifax mortgage lender.

Its latest survey, for February, shows that prices rose by 2.4% last month, leaving them 7.9% higher than a year ago.

That was the fastest annual pace of increase since October 2007 and means the average UK home now costs £179,872.

The Halifax said the pick-up was mainly due to better economic conditions.

"Several factors appear to have boosted demand, such as the improved economic outlook, unemployment falling faster than expected, improvements in consumer confidence and low interest rates," said Stephen Noakes of the Halifax.

"However, continuing pressures on household finances, as earnings fail to keep pace with consumer price inflation, are expected to remain a constraint on the rate of growth of house prices.

"We are also seeing signs of a revival in house building, which should help bring supply and demand into better balance and curb upward pressure on prices over the medium and longer terms," he added.

Prices and sales

The Halifax's figures are based on a sample of its own lending.

This explains why its figures often differ from those of its rival, the Nationwide (which also samples its own lending), and from official house price reports from organisations such as the Land Registry for England and Wales and the Office for National Statistics (ONS).

At the moment, all these surveys are pointing in the same direction, showing that prices are rising in most parts of the UK and at a particularly fast rate in London.

Authorities such as the Bank of England have denied that a house price "bubble" is being formed, but if present trends continue, national house price inflation may rise above 10% within a few months, far higher than the current rate of CPI inflation, which stood at 1.9% in January.

Sales have been picking up strongly too in the past year.

The Halifax pointed out that house sales in the UK had risen for the ninth month in a row in January, and that the number of mortgages approved for home buyers, but not yet lent, was 42% higher than a year ago, suggesting a further rise in sales is still to come.

More on This Story

The BBC is not responsible for the content of external Internet sites

More Business stories

RSS

Business Live

  1.  
    11:06: Car sales up in February

    Staying on a car theme, UK new car sales rose 12% in February, says the Society of Motor Manufacturers and Traders (SMMT). February car sales totalled 76,958, taking sales in the first two months of 2015 to 8.3% overall. Sales rose by nearly 10% last year, their highest rise in a decade, the SMMT said in January.

     
  2.  
    10:49: Aston Martin at Geneva
    Aston Martin Vulcan

    Do you like Aston Martin's? Of course you do. In which case you really ought to take a look at its new car, the Vulcan.

     
  3.  
    10:35: Cold homes
    fireplace

    The health watchdog NICE - the National Institute for Health and Care Excellence - is calling on plumbers and heating engineers, as well as family doctors to sound the alarm if people in England are living in homes that are too cold. The aim is to reduce the higher level of deaths in winter.

     
  4.  
    10:19: Greek unemployment
    A man walks by greek flags for sale

    Greece's jobless rate rose to 26% in December from 25.9% a month earlier as the economy shrank slightly in the last quarter of 2014, statistics agency ELSTAT says. That's the lowest unemployment rate since September 2014 and now quite a bit below the record high set in September 2013, when unemployment hit 27.9%.

     
  5.  
    Mobile World Congress Via Twitter
    BBC

    BBC technology correspondent Rory Cellan-Jones tweets: From the Ubuntu phone to VR headsets find all our coverage by choosing mobile phones topic in BBC news app @BBCRoryCJ

     
  6.  
    09:42: Zalando expansion
    Zalando

    Watch out Asos... Zalando, Europe's biggest online-only fashion retailer, plans to hire 2,000 new staff as it aims for sales growth of 20% to 25% this year. It is considering setting up local distribution hubs in Britain as well as Italy, Spain and the Nordics to complement its existing warehouses in Germany. Frankfurt-listed Zalando is worth almost €6bn (£4.3bn); Asos is valued at £2.7bn.

     
  7.  
    09:24: House prices

    The current figures may be slightly deceptive however. Halifax says prices rose by 2.6% in the three months to February, compared with the previous three months. Its housing economist, Martin Ellis, says a modest rise in activity reflects increases in real earnings and spending power, recent falls in mortgage rates and changes to stamp duty.

     
  8.  
    09:10: House prices
    Sale and Sold signs

    House price in February were 8.3% higher than the same month a year ago, according to the latest Halifax figures, falling back from 8.5% rise last month and a peak in July of 10.2%. Compared with January prices were 0.3% lower. The average house now costs £192,372, Halifax adds.

     
  9.  
    08:57: Market update

    London's FTSE 100 Index is up 0.14% at 6,929 as traders wait for more details of the European Central Bank's bond-buying programme to be released later today. Aviva shares have jumped this morning after it raised the dividend by 30% on a strong set of annual results.

     
  10.  
    08:44: Carrefour results
    Carrefour

    Carrefour - the world's second-largest retailer after Walmart - plans to spend about €2.5bn (£1.81bn) on revamping stores in 2015 - the final leg of a three-year turnaround plan. The French group could also go ahead with an IPO of its business in Brazil - the supermarket chain's second-largest market - if conditions remain favourable. Operating profits came in at €2.38bn for 2014.

     
  11.  
    Via Twitter Radio 5 live

    Sean Farrington tweets: On Wake Up to Money's podcast today...After 6 yrs of low interest rates, where could you have got good returns? @seanfarrington

     
  12.  
    08:25: Virgin Money
    London marathon

    After listing in November, the challenger bank is set to be admitted to the FTSE 250 later this month. Its shares are up 13% to 327.5p, valuing it at £1.4bn. Virgin Money, which sponsors the London marathon, said today that underlying pre-tax profits rose 127% to £121.2m for 2014.

     
  13.  
    08:23: ECB bond buying BBC Radio 4

    Andrew Wilson, chief executive of Goldman Sachs Asset Management, also tells Today it will take time before we will see the impact of the ECB's bond-buying programme. He expects inflation to remain low for most of this year: "Almost certainly we will see negative rates of inflation this year; we're really talking about 2016 to see the impact of this policy."

     
  14.  
    08:12: Bupa results

    Bupa wants to capture a slice of India's fast-growing health insurance market when rules on foreign investment are relaxed. Stuart Fletcher, chief executive, says it's "still quite a nascent market - there is tonnes of headroom for growth". The private healthcare group posted annual profits up 8% to £638m today.

     
  15.  
    SFO bank probe Robert Peston Economics editor

    Does alleged scamming of £200bn Bank of Eng scheme to rescue banks show that some bankers need psychiatric help?

     
  16.  
    07:53: Best investments Radio 5 live
    Lego

    Wake Up To Money was asking listeners earlier about the best investment they have made. For one listener it was a Lego Millennium Falcon set. Have you made a particularly canny investment? Give us your thoughts at bizlivepage@bbc.co.uk or @bbcbusiness.

     
  17.  
    07:42: Aviva profits

    Mr Wilson's comments came as the insurance giant Aviva reported a 6% rise in pre-tax operating profit of £2.17bn, compared with just over £2bn a year earlier. The insurer has has been going to through a strategic overhaul including the sale of its North American business last year. It also raised in annual dividend by 30%.

     
  18.  
    07:31: Aviva profits
    Aviva stadium

    Aviva chief executive Mark Wilson says its annual results show the insurer is making "tangible progress". Aviva - sponsor of Dublin's rugby stadium - started "2015 in a position of strength", but he adds it would be "wrong to assume that our turnaround is nearing completion, as we have further to travel than the distance we have come".

     
  19.  
    07:20: London Stock Exchange Group
    LSE Group

    Another good year for London Stock Exchange Group, with revenue up 32% to £1.28bn and adjusted pre-tax profits up 17% to £445.9m. However, on the pure pre-tax level profits slipped 5% to £284.3m. The company is worth £8.3bn and its shares have risen 18% in the past year.

     
  20.  
    SFO Bank investigationVia Twitter Kamal Ahmed BBC Business editor

    "Unprecedented" much over-used by us hacks, but this actually is @BBCNews SFO launches Bank of England criminal probe

     
  21.  
    07:10: ECB bond buying BBC Radio 4
    The EURO logo

    The European Central Bank reveals more details of its bond-buying programme later today - but don't expect any surprises, Andrew Wilson, chief executive of Goldman Sachs Asset Management, tells Today. He says we've already seen "marked weakening" of the euro, so it will be interesting to see what impact ECB action will have.

     
  22.  
    06:55: Drones
    drone

    The House of Lords has called for a tracking system for all drones and their users. A report by the EU Committee of the House of Lords described drones - or Remotely Piloted Aircraft Systems, to give them their official title - as an "exciting new technology", but warned that their use poses risks to the general public and other airspace users.

     
  23.  
    06:44: China growth BBC Radio 4

    China's 7% economic growth target for 2015 is about "sending a message" particularly to local governments, which look to Beijing for guidance in setting their own targets. But at the the same time the government is very concerned about the level of debt in the banking sector - something it is trying to address, Duncan Innes-Ker, China analyst with the Economist intelligence Unit, tells Today.

     
  24.  
    06:30: AbbVie

    Big news from the pharma world overnight as US company AbbVie announced a deal to buy leukemia drugmaker Pharmacyclics for $21bn (£13.8bn). It appears to have won the prize from under the nose of Johnson & Johnson, which some reports say was close to a deal.

     
  25.  
    06:20: Brazil economy Radio 5 live
    Copacabana beach

    The Brazilian currency - the real - has hit a 10-year low after the central bank raised interest rates by half a point to a stonking 12.75% overnight. The BBC's Daniel Gallas in Sao Paulo tells Wake Up to Money that the country could tip into recession this year as the government embarks on an austerity drive, raising taxes and cutting spending.

     
  26.  
    06:11: Interest rates Radio 5 live

    It's been six whole years since the Bank of England cut the base rate to 0.5%. That's been good for borrowers, but not so great for savers - of which there are many more after all. Vivan Slattery, an independent financial adviser, tells Wake Up To Money many of her clients have stayed in cash but are now looking at alternatives given that rates do not seem set to increase sharply anytime soon - particularly as many mortgage holders are now on the standard variable rate.

     
  27.  
    06:05: China growth Radio 5 live

    China has announced that its target growth rate for 2015 is 7% - down from 7.5% for last year. The BBC's Ali Moore in Singapore says the new target is not a reflection of panic in Beijing but part of its drive to lower expectations and rebase the economy to focus more on domestic demand. "It's more about quality than quantity," she adds.

     
  28.  
    Welcome to Thursday Chris Johnston Business reporter

    Good morning from me and Matthew West. Another busy day of business news coming up - we'll be here to guide you through it all. Get in touch with your comments at bizlivepage@bbc.co.uk or on Twitter at @bbcbusiness.

     

Features

Try our new site and tell us what you think. Learn more
Take me there

Copyright © 2015 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.