Nationwide Building Society Halifax

House price growth robust in February, says the Halifax

House signsImage copyright PA

UK house prices continue to rise at a "robust pace", the Halifax has said - a position echoed by the latest figures from a rival lender.

The Halifax, part of Lloyds Banking Group, said property values were up 9.7% in February compared with a year ago, but down slightly on January.

The Nationwide Building Society said house price growth remained "steady".

Demand outstripping the number of homes on the market is pushing up house prices, surveys suggest.

Affordability

The annual rate of change of 9.7% was unchanged, with the average home valued at £209, 495. The Halifax added that property prices were down 1.4% in February compared with January.

"Prices continue to rise at a robust pace driven by a significant imbalance between supply and demand. Whilst this position is likely to continue over the coming months, there are some tentative signs that the supply situation may be beginning to improve, " said Martin Ellis, Halifax housing economist.

"Further ahead, increasing affordability issues, as house price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease."

Stamp duty change

Image copyright Getty Images

That was the same month-on-month rate as in January, but was sharply slower than December's increase of 0.8%.

However, the annual growth rate picked up to 4.8%, compared with the figure of 4.4% the previous month.

The average price of a property is now £196, 930, the Nationwide said.

The building society also said that the number of mortgages approved went up sharply in January to nearly 75, 000.

This compared with about 71, 000 approvals in December and was the highest number for two years.

"However, much of the increase is likely to be related to the impending increase in stamp duty on second homes, which is due to take effect in April, " said the Nationwide's chief economist, Robert Gardner.

"This is likely to have brought forward a significant number of purchases, which in turn will probably result in a fall back in approvals during the spring [and] summer."

Changes to the system, announced by Chancellor George Osborne in the Autumn Statement, mean that buy-to-let landlords and owners of second homes in England and Wales will have to pay a 3% surcharge on each stamp duty band.

Key vote

Commenting on the figures, the chief UK and European economist at IHS Global Insight, Howard Archer, said an overview of the various housing surveys indicated that prices would rise by 6% in 2016, "amid reasonably healthy buyer interest".

However, he warned that the UK's referendum on EU membership on 23 June posed a "potential major downside risk to housing market activity and prices".

He added: "A vote for Brexit would be liable to see a marked hit to UK economic activity over the rest of this year and in 2017 amid heightened uncertainties, which would likely weigh down heavily on the housing market."

House price surveys explained

Image copyright PA

Various surveys record UK house prices on a monthly basis, but they all have slightly different methodology.

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