There has been a 1.9 per cent fall in house prices in the year ending last month, according to the Halifax house price index released yesterday. In the frequently volatile housing market, this represents a general continuity of prices year-on-year; indeed, the average house price in the UK in February was £160,118, barely any change on the £160,393 average of last April. The monthly trend reversed the gains that were seen in January, when there was a 0.6 per cent increase in prices; in February, they fell by 0.5 per cent.
These figures should be taken with a grain of salt, given their almost perfect opposition to the stats released by Nationwide earlier this month, which showed a 0.6 per cent increase in February, and a 0.9 per cent rise year-on-year
The proportion of house buyers who were entering the market for the first time increased for the second month in a row, and Halifax suggest that this increase, alongside a 7 per cent rise in the number of mortgages approved industrywide, can be put down the the scheduled ending of the temporary increase in the starting threshold of stamp duty for first-time buyers from £125,000 to £250,000 later this month. This could be encouraging some to buy before the threshold reverts to the lower level. If that's the case, we should see a corresponding fall in April, which we await with baited breath.
The historical data in the index shows how far we have to go to reach the state we once were in. The UK average house price hit a recent trough in December last year, at £159,888, but prices were lower shortly following the onset of the recession 2008/9. Once adjusted for inflation, however, the ongoing market slump is clear. In 1983 pounds (the year the index began), the average house price in January was £55,852 - and the last time it was that low was almost a decade ago, in September 2002.