House prices to rise by 8% in 2014, says Halifax | Cross River Real Estate
House prices will end 2014 between 4% and 8% higher than they start the year, but it is "too early to talk of a housing bubble", the UK's largest lender has said.
Further economic recovery and continued low interest rates should support the market, according to Halifax, but several factors – including continuing pressure on household finances – should limit the increase.
The lender has reported a 7% increase in prices in the first 11 months of 2013, which puts the average UK house price at £174,910 at the end of November.
An 8% increase would push this up by more than £1,000 a month to £188,903, which is still some way from the £199,612 peak recorded in August 2007.
Halifax's chief economist, Martin Ellis, said: "Despite the recent gains, house prices remain 12% below their August 2007 peak, and transactions in 2013 are still around a third below the average for 2006 and 2007.
"House prices are also lower in relation to earnings, with the average price currently 4.8 times average annual earnings compared with a multiple of 5.8 in 2007. There is little sign of the excessive behaviour associated with a house price bubble at present."
Ellis said that another year of growth at the current rate would not be enough to create a bubble, pointing out that between 2001 and 2004 there were double digit increases each year, and that overall prices increased by 150% in the eight years leading up to 2007.
http://www.theguardian.com/money/2013/dec/23/house-prices-rise-2014-halifax-bubble
Further economic recovery and continued low interest rates should support the market, according to Halifax, but several factors – including continuing pressure on household finances – should limit the increase.
The lender has reported a 7% increase in prices in the first 11 months of 2013, which puts the average UK house price at £174,910 at the end of November.
An 8% increase would push this up by more than £1,000 a month to £188,903, which is still some way from the £199,612 peak recorded in August 2007.
Halifax's chief economist, Martin Ellis, said: "Despite the recent gains, house prices remain 12% below their August 2007 peak, and transactions in 2013 are still around a third below the average for 2006 and 2007.
"House prices are also lower in relation to earnings, with the average price currently 4.8 times average annual earnings compared with a multiple of 5.8 in 2007. There is little sign of the excessive behaviour associated with a house price bubble at present."
Ellis said that another year of growth at the current rate would not be enough to create a bubble, pointing out that between 2001 and 2004 there were double digit increases each year, and that overall prices increased by 150% in the eight years leading up to 2007.
http://www.theguardian.com/money/2013/dec/23/house-prices-rise-2014-halifax-bubble
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