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House price growth reaches 2.8% amid coronavirus fears

Annual house price growth reached 2.8% in February, dropping from a high of 4.1% in January, Halifax’s House Price Index has found.

Quarterly growth stands at 2.9%, with monthly prices rising by 0.3%.

Russell Galley, managing director, Halifax, said: “Much like we saw in January, the increases seen in February reflect the continued improvement of key market indicators.

“The sustained level of buyer and seller activity is strong compared to recent years, with positive employment conditions and a competitive mortgage market continuing to support demand.

“Looking ahead, there are a number of risks, including the potential impact of coronavirus, which continue to exert pressure on the economy and we wait to see how these will affect housing market sentiment later in the year.”

Galley wasn’t the only person to bring up the impact the coronavirus outbreak could have on the economy.

Tomer Aboody, director of property lender MT Finance, said: “Let’s hope that these positive trends continue, although buyers and sellers are still conscious that Brexit hasn’t been done yet and therefore the market can still be affected.

“This, along with the potential for foreign buyers to be hit by currency and stock market fluctuations due to the coronavirus, which would negatively impact their buying power, could cause an issue with liquidity at the super prime end of the market.”

Ben Johnston, director of off-market property app Houso, said: “Next week’s Budget gives the government the chance to stimulate growth further by reducing stamp duty although this might not be enough until the coronavirus has stabilised and the threat has diminished.

“That all-too-precious confidence, which is so important for the market, is hanging in the balance.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “On the ground, the market remains price sensitive with still too few listings but we are not finding properties being withdrawn with most buyers and sellers taking the view that the worst effects will pass sooner rather than later.”

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