February marks 14 months of rising house prices
House prices stormed forward in February, marking the 14th month in a row of increases.
Prices rose 0.6 per cent in February, according to figures from Nationwide. That takes the average home sale price to £177,846. Year-on-year, they rose 9.4 per cent in the month.
Source: Nationwide
Robert Gardner, Nationwide’s chief economist says price growth is being bolstered by constrained supply in the housing market. Completions are, he adds, still well below pre-crisis, "which was already insufficient to keep up with the pace of household formation."
For example, in England around 109,500 new homes were built in 2013, this is 38 per cent below the level recorded in 2007 and around half the projected number of households that are expected to form each year in the years ahead.
Source: Nationwide
Meanwhile, Howard Archer of IHS Global Insight comments:
While the strength of house prices is not yet a serious concern outside of London, it is something that needs to be closely monitored given that a number of recent data and surveys have indicated that the strength in house prices is becoming more widespread. There is rising buyer interest and strengthening market activity across regions.
IHS expects house prices to rise by around eight per cent this year, with gains country-wide. It cautions, however, that this could be a conservative estimate.