House prices dropped by 0.1% in February

House prices dropped by 0.1 per cent in February, according to Halifax. The prices increased by 5.2 per cent on an annual basis with the average house price coming to £251,697. However, on a quarterly basis, this equates to a 0.5 per cent change.

Russell Galley, managing director at the Halifax, said:

“The government’s decision to extend the stamp duty holiday – one of the main drivers of demand from home movers during the pandemic – has removed a great deal of uncertainty for buyers with transactions yet to complete.

He further commented that it has been a soft start to 2020 and “the housing market has been at something of a crossroads.”

He added that the long term housing market performance “remains inextricably linked to the health of the wider economy.”

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Stamp duty relief in England, Northern Ireland, and the equivalent in Wales, have all been extended. Thus, it has “removed uncertainty” for those completing house purchases.

The housing market is observing annual growth above 5% for the past seven consecutive months. Now we need to see how long the market can hold on to this growth. In our opinion, first-time buyers might not participate in this market. They will be probably relying more on the government guarantee mortgages instead of stamp duty relief.

 

Radstock Property co-founder George Franks says:

“March is likely to see a much more pronounced rise in house prices due to the extension of the stamp duty holiday and the new mortgage guarantee scheme.

“Since the Budget, we have already noticed an uptick in prospective buyers and this is likely to continue.

“Prices are also being supported by a phenomenal lack of stock. For now, in the capital at least, properties for sale are as rare as hens’ teeth.

If you need further advice on the monthly house price index, please call us. Our financial advisors will be delighted to offer you a free initial consultation.

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