Halifax House Price Index (1367Z)
January 10 2011 - 3:00AM
UK Regulatory
TIDM68FF
RNS Number : 1367Z
HBOS PLC
10 January 2011
Halifax House Price Index
National Index December 2010
All Houses, All Buyers Index (1983=100)
Annual Change -1.6% Quarterly Change Monthly Change
-0.9% -1.3%
Standardised Average Price (seasonally adjusted) GBP162,435
Commenting, Martin Ellis, housing economist, said:
"Prices in the final three months of 2010 were 0.9% lower than
in the previous quarter. This rate of decline is significantly less
than the quarterly falls of 5-6% during the second half of 2008.
House prices fell by 1.3% between November and December.
"Looking forward, we expect limited movement in house prices
during 2011 but with the risks on the downside. Interest rates are
likely to remain very low for some time. This will continue to
support a favourable affordability position for those entering the
market and limit financial pressure on existing homeowners to sell.
Current signs that homeowners are becoming more reluctant to sell
would, if continued, help reverse the imbalance between buyers and
sellers. Nonetheless, uncertainty about the economy, weak earnings
growth and higher taxes could put some downward pressure on
demand."
Key facts
-- Prices in the three months to December were 0.9% lower than
in the preceding three months. This rate of decline remains
significantly lower than the quarterly falls of 5-6% during the
second half of 2008. House price data on this basis provides the
clearest indication of overall market trends, smoothing out the
monthly volatility caused by the reduced number of monthly
transactions used to calculate all house price indices.
-- On an annual basis, prices in December were 1.6% lower as
measured by the average for the latest three months against the
same period a year earlier. Prices in December alone were 3.4%
lower than in December 2009.
-- Nationally, we expect limited movement in house prices during
2011 but with the risks on the downside. Some modest variations in
house price performance across the country, however, are likely.
The regional picture is likely to be affected by the impact of
public spending reductions.
-- The low interest rate environment has reduced the burden of
servicing mortgage debt. Typical mortgage payments for a new
borrower have fallen from a peak of 48% of average disposable
earnings in mid 2007 to 29% in the last quarter of 2010. This key
measure of affordability is at a better level than the long-term
average over the past 25 years (37%) and is an important factor
supporting housing demand.
-- Possible sign of housing market activity stabilising. The
number of mortgages approved to finance house purchase - a leading
indicator of completed house sales - increased in November
following six successive monthly falls, according to Bank of
England industry-wide figures. The number of approvals, at 48 000,
was the highest since July on a seasonally adjusted basis.
Approvals were 19% lower than a year earlier - 59,000 in November
2009 - due to the ending of the stamp duty holiday on properties
between GBP125 000 and GBP175,000 at the end of 2009, which boosted
the number of approvals during the last part of that year.
The Halifax House Price Index is prepared from information that
we believe is collated with care, but we do not make any statement
as to its accuracy or completeness. We reserve the right to vary
our methodology and to edit or discontinue/withdraw this, or any
other report. Any use of this report for an individual's own or
third party commercial purposes is done entirely at the risk of the
person making such use and solely the responsibility of the person
or persons making such reliance. (c) Bank of Scotland plc all
rights reserved 2011.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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