UK house prices grew at their fastest rate in over a year at the start of 2020, according to Nationwide, as experts hailed Boris Johnson’s election victory.
The housing market posted a 1.9 per cent annual rise in January, beating December’s 1.4 per cent climb. That followed 12 months of consecutive growth below the one per cent mark after November 2018’s 1.4 per cent hike.
Growth in UK house prices rose 0.5 per cent between December 2019 and January 2020, Nationwide’s figures also showed today.
That left the average UK home valued at £215,897.
‘Boris bounce’ boosts UK house prices
“Sparks were flying after the election but this month the housing market has ignited, with the so-called Boris bounce providing the match,” Lucy Pendleton, founder of James Pendleton estate agents, said.
“A year ago the annual growth rate was just 0.1 per cent. This step change in house price growth is being driven by a resurgence of demand and, with it coming before we’ve even left the EU, is clearly significant.
“Boris Johnson’s emphatic election victory has retrieved the spanner from the works and the housing market is now positively humming.”
Nationwide’s figures follow UK Finance data revealing that home buyer mortgage approvals also soared 24 per cent in the run up to Christmas.
But Nationwide chief economist, Robert Gardner, took a more measured view of January’s growth.
He said: “The underlying pace of housing market activity has remained broadly stable, with the number of mortgages approved for house purchase continuing within the fairly narrow range prevailing over the past two years.
“Healthy labour market conditions and low borrowing costs appear to be offsetting the drag from the uncertain economic outlook.”
He added that economic growth slowed dramatically at the end of 2019, but business surveys are pointing up at the start of 2020.
‘Step change’ in sentiment
David Westgate, chief executive at Andrews Property Group, hailed January’s growth in UK house prices as a “step change” in buyer demand.
“While prices didn’t skyrocket in January, compared to just three months ago the mood in the property market has changed quite materially,” he added.
“People who were hesitant amid the political uncertainty of recent years are now making their move. January can always be a bit slow but the signs for the Spring as a whole are very promising.
“There is a huge amount of pent-up demand in the market and we are already seeing it start to come through.
“Crucially, even aspirational movers are coming back to the market, which highlights how sentiment has improved.”
More to follow.