Good Signs for House Prices?
Most housing market observers reported a dip in prices during February. The Nationwide reported prices dipping by 0.1 per cent across the month, and the Halifax released a report showing a greater decline of 0.3 per cent, with the UK average house price sitting at £192,372 by their measuring criteria. The dip in February represents the first monthly fall in house prices since October of last year, with January having seen a rise of 1.9 per cent.
What are we to make of the February figures? Well, the likelihood is that we shouldn’t be too concerned by them. The quarterly price figures show that in the three months to February prices went up by 2.6 per cent relative to the previous quarter. The underlying longer term trend seems to be positive – the quarterly figures to February are 8.3 per cent higher compared to the same quarterly period 12 months ago.
What we have seen at Robert Oulsnam and Company has been largely positive market activity, despite price falls during February. We’ve had record levels of new instructions and record sales for the month, which are clear signs that house prices will soon start to gather momentum during the spring months, with the prospect of increases of several per cent in some areas. Across our Oulsnam branches there have been indications of brighter prospects for the market moving further into 2015.
This chimes with much expert opinion on the market prospects for the rest of 2015. The economic analysts at IHS Global Insight predict that market activity will pick up significantly in the coming months as we head into summer. They have forecast price rises of 5 per cent over the course of 2015.
The February price falls have largely been put down to the market adjusting itself following the sharp rises seen during January. Market observers have described it as no more than a minor correction, with the quarterly figures being a more accurate picture of the direction of the market, as they iron out any monthly volatility and anomalies.
Those figures that have so far been released on prices during March have suggested things are again picking up. The Nationwide reports that average house prices have lifted during March to £189,454 from £187,964 during February. Moreover, the most recent results from the Halifax House Price Optimism Index show increased optimism for prices over the next 12 months, rising in March to 60 points having been at 52 in February.