27th December 2013
House prices will continue their impressive levels of growth in 2014, the latest report from Halifax has stated, with demand from buyers likely to continue to be the driver behind this improvement throughout the year.
It said that 2013's first 11 months have seen house price growth amounting to around seven per cent, adding that this will be a trend that broadly stays the same in 2014.
Growth this year has been driven by the fact there has been a much improved level of transactions across the sector in the UK. Sales amounted to more than a million throughout 2013, the bank reported.
It was the first time that this number has been exceeded since 2007, before the financial uncertainty in the country caused the property market to fall spectacularly.
However, the housing bubble seen back then is not expected to return in 2014, the bank stated.
Halifax predictions state that 2014 will see house prices increase by some eight per cent as the market keeps up the strength that has been seen across the past few months.
Martin Ellis, Halifax’s housing economist, said: "The housing market has been stronger than expected during 2013. Higher demand, combined with an insufficient rise in housing supply, has resulted in increases in house prices and higher activity this year.
"Low interest rates, and higher consumer confidence due to the increasing evidence that a sustainable economic recovery may now be underway, are helping to stimulate housing demand. Schemes, such as Funding for Lending and Help to Buy, also appear to have boosted demand."
Drivers of the property market in 2014 are expected to be the fact that job prospects will improve - the economy is predicted to expand by 2.4 per cent across next year - and the fact that household finance will improve throughout the year.
In addition to this, it is expected that mortgage rates will remain low, while the appetite to buy will still be high as more and more people look to take advantage of the Help to Buy scheme before it ends in 2017.
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