House prices continue robust growth, say Halifax and Nationwide

The Halifax, part of Lloyds Banking Group, said property values were up 9.7 per cent in February compared with a year ago, but down slightly on January.

Meanwhile, rival Nationwide Building Society said house price growth remained “steady” as demand continues to outstrip the number of homes on the market.

The Halifax said that house prices in the three months to the end of February were up 3 per cent compared with the previous three months.

The annual rate of change of 9.7 per cent was unchanged, with the average home valued at £209,495. The Halifax added that property prices were down 1.4 per cent in February compared with January.

Martin Ellis, Halifax housing economist said: “Prices continue to rise at a robust pace driven by a significant imbalance between supply and demand. Whilst this position is likely to continue over the coming months, there are some tentative signs that the supply situation may be beginning to improve.”

He added: “Further ahead, increasing affordability issues, as house price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease.”

The Nationwide said that it had found house prices rose 0.3 per cent last month compared to January.

That was the same month-on-month rate as in January, but was sharply slower than December’s increase of 0.8 per cent.

However, the annual growth rate picked up to 4.8 per cent, compared with the figure of 4.4 per cent the previous month.

The average price of a property is now £196,930, the Nationwide said.

The building society also said that the number of mortgages approved went up sharply in January to nearly 75,000.

This compared with about 71,000 approvals in December and was the highest number for two years.

“However, much of the increase is likely to be related to the impending increase in stamp duty on second homes, which is due to take effect in April,” said the Nationwide’s chief economist, Robert Gardner.

“This is likely to have brought forward a significant number of purchases, which in turn will probably result in a fall back in approvals during the spring summer.”

Changes to the system, announced by Chancellor George Osborne in the Autumn Statement, mean that buy-to-let landlords and owners of second homes in England and Wales will have to pay a 3 per cent surcharge on each stamp duty band.