Experts warned against predicting a prolonged revival in price growth based on the Halifax figures. Samuel Tombs, the chief UK economist at Pantheon Macroeconomics, said: “The jump in Halifax’s measure of house prices in March just looks like volatility, rather than the start of a strong upward trend. Halifax’s index is prone to large swings.”
Howard Archer, chief economic adviser at EY Item Club, the economic forecasting group, said: “The March spike in house prices reported by the Halifax does not change our view that 2018 will be a difficult year for the housing market. We still expect price gains over the year will be limited to a modest 2%.”
Russell Galley, Halifax’s managing director, said: “Activity levels, like house price growth, have softened compared with a year ago. Mortgage approvals are down compared to 12 months ago, whilst home sales have remained flat in the early months of the year. This lack of direction in the housing market is in stark contrast to the continuing strength of the UK jobs market.”
He said low unemployment, low mortgage rates and the ongoing shortage of properties for sale would underpin price growth in coming months. Halifax is predicting annual price growth to remain close to 3%.
Jeremy Leaf, an estate agent in north London and housing spokesman at the Royal Institution of Chartered Surveyors, echoed Galley’s comments. “The increase in property prices is more to do with a shortage of stock, low mortgage approvals, and subdued activity rather than any great change in the market,” he said.
“What the results do show is that those who are actually looking to buy at this time of year are obliged to pay higher prices for properties in the areas they want to live in order to get what they want, which is what we are also finding on the ground.”