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UK property prices crept up in the three months to February, latest index shows

This was the third consecutive increase in prices on this measure of the underlying trend and was the same as the increase in January and the biggest increase since September 2010 when it was 2.6%.
 
On a monthly basis house prices increased by 0.5% in February following a small fall of 0.3% in and on a quarterly basis are 1.9% higher than a year ago.

Martin Ellis, Halifax’s housing economist, said that there is evidence of improvement in the market and he expects prices to increase in 2013. ‘However, weak income growth and continuing below trend economic growth are likely to remain significant constraints on housing demand,’ he added.

Peter Rollings, CEO of estate agent Marsh & Parsons, said that it is not yet full steam ahead for the national housing market, but it is certainly building momentum. ‘Buyer demand is strengthening as we head into the typically busier spring period and an improved start to the year from the mortgage market, combined with greater confidence in the labour market, has helped remove some of the inertia in the national sales,’ he explained.

‘But the improvement continues to be powered by the strong performance of London. Both domestic and foreign buyers’ appetite for bricks and mortar in the capital seems undiminished, and unless we see a sudden wave of properties hitting the market, prices will rise further over the spring period,’ he said.

He also pointed out that the recent surge in the world’s stock markets, including the FTSE 100, indicates a change in sentiment and that’s a highly significant factor in driving the UK’s property market.

‘However, it’s crucial that the Chancellor doesn’t take steps in this month’s Budget to ratchet up property taxes and derail progress just as the housing market seems to be getting back on the right track. With London so pivotal in the recent recovery, any move that would disproportionately hit home owners or sellers in the capital would take a toll on the wider national market,’ he added.

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