House prices expected to stay flat in 2010.
House prices creep up as the economy slumps
Published: 09 December, 2009
LONDON: House prices edged up by 1.4% in November, according to the Halifax house price index published today.
The lender said prices are down 1.6% compared with November last year but have risen by 8.5% since the low in April this year. It is the fifth successive monthly increase.
Analysts caution against optimism, stating the increase in prices are due to higher demand and a continued lack of properties for sale.
Martin Ellis, housing economist at Halifax, said: "The prospects for the market will depend on how the UK economy evolves and whether there is a significant increase in the supply of properties for sale. Our view is that house prices will be flat during 2010."
James Hyman, partner for residential sales at property consultants Cluttons, said: "Halifax's figures suggest sellers are still in the driving seat, as the stock of property for sale remains extremely limited, forcing prices upwards.
"I expect to see this change rapidly in the New Year, as people who have held off selling over the past year or so are encouraged to come to market by rising prices. This could bring about a second dip in property values."
The house prices news comes on the back of gloomier than expected figures for Britain's manufacturing sector, which failed to grow at all in October.
The latest figures issued today from the Office for National Statistics, also revised down its estimate of the sector's performance in September.
Vicky Redwood, economist at Capital Economics, said the new data suggests the recovery looks fragile and Ross Walker at Royal Bank of Scotland said: "there's not much to suggest it's going to be a vibrant rebound. It's sluggish."
These numbers follow a disappointing report from the British Retail Consortium which showed sales up 1.8% year-on-year in November, a sharp slowdown from the 3.8% growth recorded in October.
These figures dampen hopes raised by earlier ONS data showing the UK construction industry was stronger in the third quarter than first thought.