According to the latest Halifax House Price Index house prices rose by 1.1 % in July, and although they are still 12.1 per cent down on the same time last year, this is the second price rise in three months and the third this year.

Comparing the last three months with the previous three months house prices were 0.8% higher, and this slight increase was the first rise on a quarterly basis since October 2007.
The Halifax index found that despite the slight monthly increase last month, house prices in July were still 12.1 per cent lower on an annual basis.

Signs of a slight improvement in the market have been supported by Halifax’s house price to earnings ratio – a key affordability measure – which has declined from a peak of 5.84 in July 2007 to an estimated 4.36 in July 2009. The long-term average is 4.0.

The news comes as recent Bank of England figures showed that the number of mortgages approved to finance house purchase increased by 22 per cent between the first and second quarters of 2009.
In addition, mortgage approvals increased for the fifth successive month in June and were 35 per cent higher than in the same month in 2008. They were nonetheless still 58 per cent lower than in June 2007.

Also, demand for homes has risen, albeit from a very low base, since the start of the year, driven by improvements in affordability and low interest rates. Higher demand has combined with low levels of property available for sale to boost sales activity from exceptionally low levels and support prices over the past few months.

This entry was posted on Wednesday, August 5th, 2009 at 2:47 pm and is filed under Mortgages. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.