Property prices have grown by 2.5 per cent on a yearly basis, with average house costs growing for the fourth month in a row.
The Halifax House Price Index found average house prices rose by 1.3 per cent in January, the fourth consecutive monthly rise, with a typical home now costing £291,029.
This is an increase of more than £3,900 on the average price from December.
This news was received positively by ASK Partners CEO and co-founder, Daniel Austin, who said: “Today’s data shows that the property sector is beginning to show signs of recovery.”
He explained that, with a yearly decline in inflation and the peaking of interest rates, the overall outlook has improved “considerably”.
“Rent values have seen sustained growth, positioning real estate as reasonably valued in comparison to gilts and presenting growth potential,” he added.
Contributing factors
Halifax Mortgages director, Kim Kinnaird, provided some insight into what factors had fueled the house price rise.
“The recent reduction and mortgage rates from lenders as competition picks up, alongside fading inflationary pressures and a still-resilient labour market has contributed to increased confidence among buyers and sellers,” she said.
“This has resulted in a positive start to 2024’s housing market.”
A similar sentiment was shared by Purplebricks CEO, Sam Mitchell, who said: “There is a growing confidence in the industry and, as a result, there’s been a dramatic increase in the number of buyers, viewings and offers since the beginning of 2024.
"This has been fueled by banks continuing to compete on mortgage rates.”
Additionally, IP Global head of global sales, William Page, pointed out the uptick in enquiries seen in January compared to the fourth quarter of 2023 suggested this confidence is “trickling down” to buyers.
“With opportunities for deals out there and rents having surged in 2023 there is a real appetite to buy. I would expect prices to remain relatively flat for the first half of the year and then increase as rates continue to drop,” he added.
Regional disparity
The HPI also recorded that Northern Ireland experienced the strongest growth across all nations or regions in the UK, seeing house prices increase by 5.3 per cent on an annual basis.
As a result, properties in Northern Ireland now cost on average £195,760, £9,761 more than the same time in January 2023.
Positive growth was also seen in Scotland and Wales, each experiencing 4 per cent growth on an annual basis to £206,087 and £219,609 respectively.
However, not all areas recorded growth, with the South East falling the most when compared to other UK regions, with homes selling for an average £379,220, a drop of £8,866 or 2.3 per cent.
London remained the region with the highest average house price at £529,528, albeit prices in the area were found to have declined by 0.4 per cent on an annual basis.
tom.dunstan@ft.com
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