Hometrack reports 0.1% rise in house prices in January

Permalink: Hometrack reports 0.1% rise in house prices in January
by Kay Murchie

According to housing intelligence group Hometrack, house prices in England and Wales grew by just 0.1% in January compared with the previous month.

However, the group said the rise was fuelled by activity in London and the south while prices in the rest of the country remained flat.

Its monthly survey, which is based on information from over 1,800 agents, noted a growing north-south divide.

Meanwhile, Hometrack said house prices are 0.8% lower than a year ago.

Commenting on the figures, Richard Donnell, director of research at Hometrack, said: “An improvement in both market activity and prices over 2009 means we are starting 2010 from a higher base than 12 months ago. Today the proportion of the asking price being achieved is 93.5% compared to 88% at the start of 2009.

“We expect a continued scarcity of housing for sale in the year ahead, which itself will act as a support to pricing, but it is the outlook for demand that will be the key driver of price changes,” added Mr Donnell.

However, in comparison, last week the Nationwide reported a 1.2% rise for the month of January compared with December.

According to the Nationwide, January’s gain takes the annual increase to 8.6%.

Many housing experts are divided on their views with regard to the recovery in the market. Many were surprised by the strength in house prices over the last six months or so after several leading experts had predicted falls of around 10% for the 2009 year.

However, house prices rose in the latter half of the year as a result of higher demand and a shortage of properties up for sale.

Today leading economic forecaster, the Centre for Economics and Business Research (CEBR), said it expects house prices to rise more than 6% during 2010 and be around 20% higher by the end of 2013.