The data from the latest LSL Acadata index also shows that monthly sales are set to reach 66,000, the highest February total since 2008, which means that house sales in January and February were only 12% below average in the decade before the credit crunch.
So on a monthly basis prices have risen 1% and on an annual basis 6% and the index report predicts that 2014 will be a good year for the residential real estate market.
‘The UK housing market is firing forward on all cylinders and 2013 may have been the year when the market got back on its feet, but it seems to be this year when we’ll see it gallop onwards towards full health,’ said David Newnes, director of Reeds Rains and Your Move estate agents, owned by LSL Property Services.
‘For so long the housing market had to duck for cover from the fierce economic storm, but with the economy firmly on the mend and the jobs market picking up, this is hopefully well and truly resigned to the past. As we head into the typically busier spring period we are seeing a further strengthening of buyer demand which, combined with a thumping start to the year from the mortgage market, has bolstered confidence across the board,’ he explained.
He also pointed out that total sales in both January and February are up 49% on the same months in 2013, while the February total in particular was the highest since 2008.
‘Both are astounding indicators of how far we’ve come in the space of a year. Aspiring buyers are avidly queuing up to take up government’s Help to Buy scheme, with first time buyers especially benefitting from the wider range of mortgage loans now available,’ said Newnes.
‘As with much of the country the crux of issue that continues to push prices higher is the shortage of supply. With buyers’ appetite for bricks and mortar undiminished, unless we see a sudden wave of properties hitting the market this will become a recurring problem both in London and elsewhere,’ he added.
He also said that the Chancellor George Osborne should takes a blunt approach to challenging this supply issue in this month’s Budget, rather than take steps to notch up property taxes which could disrupt progress just as the property market is racing ahead on the right track.
Peter Williams, housing market specialist and Chairman of Acadata, believes that of greatest significance is the annual index. He pointed out that over the last year, the average house price has risen by a nominal £14,500, or 6%. ‘This percentage increase is 3.2% above January’s 12 month RPI of 2.8%, which gives credence to the Office for Budget Responsibility’s (OBR) forecast that house prices will remain ahead of inflation in 2014,’ he said.
He also pointed out that even though there appears to be stability in the rate of price change over the last 12 months, there was a sustained acceleration over the last three months. Indeed, there has been growth across all English regions and Wales. The highest regional growth in sales during the fourth quarter of 2013 compared to the same period in 2012 was in the East Midlands with a rise of 42.4%, followed by the South West up 40.7%. The lowest growth in sales was in the North at 33.7%.
And even although there has been a lot of talk of a booming market in London, the increase in sales in Greater London in the final quarter of 2013 compared to a year earlier was 36.1%, placing it in eighth place in the regional league table of transactional growth.
