House Prices in 2013.

by Mark Johnston

House Prices in 2013.

House prices have been flat or modestly declining across the UK since 2010,  therefore house prices have remained little changed over the course of 2012.

Overall last year saw an even mix of monthly rises and falls as prices continued to lack any real direction.

According to figures from the Halifax, house prices rose by an average 1.3 per cent in December 2012, thus meaning that the average house price stood at £163,845, which is higher than was seen in November.

Prices in the 3 months up until December were just 0.3 per cent lower than in the last quarter of 2011.

However, the Nationwide’s house price index showed that prices had dropped by 0.1 per cent in December.

These price differences can be explained by the different ‘average’ homes used by the lenders in their calculations and also the way the two lenders calculate the annual rate of changes differs.

Although, Nationwide’s latest house price figures reveal that price have now moved up 0.5 per cent in January 2013. This is a further sign that 2 years of static house prices and historically low sales across the UK are slowly coming down to an end.

Recent figures also show that across the country the typical percentage of the asking price achieved in January was 93.1 per cent.

According to the land registry house prices currently across England and Wales are 11 per cent below their peak reached in November 2011.

Despite the different house price indexes stating that prices are up by a certain percentage or down by a percentage, new figures have revealed that the average home has increased in value by just £13 in the last year.

Richard Donnell, director of research at Hometrack, said “despite a slow start the housing market looks to be in slightly better shape than at the start of the previous two years”.

Howard Archer, chief UK economist at IHS Global Insight has forecast flat prices for 2013, as he believes that “extended low interest rates and the beneficial impact of the central banks lending scheme are offset by difficult economic conditions”.

Adam Day, director of online estate agents, Hatched.co.uk, recently suggested that “transactions will rise during the first 6 months, with house prices potentially climbing by as much as 2 per cent across the year”.

The Royal Institution of Chartered Surveyors (RICS) also suggested that there will be a 2 per cent climb in property prices during 2013, while estate agents Savills believe there will only be a modest 0.5 per cent rise.

Other economist suggest that property prices will race ahead in the next 2 years and are therefore set to surpass their pre-financial crisis peak for the first time in 2014.

The Centre for Economics and Business Research (CEBR) also forecast that in 5 years time a typical average home will cost £261,000, representing an increase of 19.1 per cent when compared with this year.

It seems then that many experts are divided regarding house prices, but most predict a relatively flat market.



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