The housing market experienced a surge in prices last month. This was due to the combined effect of lower mortgage rates and enhanced consumer confidence, leading to a more stable market.
Halifax reported the average sale price of houses to be £285,476 in February, up 1.1% from £281,684 in January.
Additionally, the annual rate of house price growth accelerated to 2.1% in February, compared to a rise of 0.2% in January and a fall of 1.3% in December.
According to Kim Kinnaird, Director of Halifax Mortgages, the recent reduction in mortgage rates, improved consumer confidence, and the strong labour market likely contribute to the price stabilization after a dip in November and December.
However, Nationwide recently reported the worst decline in house prices in 11 years, with an annual decline of 1.1% in January.
The housing market has been under pressure due to the increase in mortgage rates post the mini-Budget in September and the Bank of England’s interest rate hikes over ten consecutive months to 4% in an attempt to curb inflation.
According to Tom Bill, who heads UK residential research at estate agent Knight Frank, it seems that the housing market in the UK is finally emerging from a prolonged period of uncertainty following the mini-budget, rather than heading towards a sharp decline in prices.
The mortgage market turmoil led to a decrease in activity before Christmas; however, it has been picking up this year, as people come to accept the current rate situation.
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