The following article appeared in Property Industry Eye which I felt summarized the current optimism well;
House prices ended the year up a very optimistic 4% annually – almost four times higher than rival indices – according to the December Halifax House Price Index.
The lender’s data, based on mortgage approvals, was well out of sync with others for much of 2019 and didn’t end the year any differently, claiming average prices were up 1.7% on a monthly basis – the largest increase during a calendar month for 2019 – to £238,963.
In contrast, Nationwide’s House Price Index for December said average prices increased 1.4% annually and just 0.1% on a monthly basis.
Russell Galley, managing director of Halifax, said: “Average house prices rose by 4% over 2019, at the top of our predicted range of 2% to 4% growth for the year.
“This was driven by a monthly gain of 1.7% in December which was the biggest monthly increase of 2019, pushing up the year-on-year growth rate and reflecting that December 2018 was a particularly weak month.
“Looking ahead, we expect uncertainty in the economy to ease somewhat in 2020, which should see transaction volumes increase and further price growth made possible by an improvement in households’ real incomes.
“Longer-term issues such as the shortage of homes for sale and low levels of house-building will continue to limit supply, while the ongoing challenges faced by prospective buyers in raising deposits will serve to constrain demand. As a result, we expect a modest pace of gains to continue into next year.”
Commenting on the data, David Westgate, group chief executive for Andrews Property Group, said: “In 2019, the property market saved its best for last.
“That December delivered the strongest growth of 2019, even with a General Election, highlights the way indifference towards Brexit grew throughout the year.
“January will be the real test of sentiment but for 2019 to have finished on such a high sets a positive note for the year ahead.
“There is an exceptional amount of pent-up demand in the market that has the potential to drive prices higher throughout 2020.
“The fact we now have a five-year administration with a strong mandate and clear political objective will create confidence and bring back the aspirational buyers and sellers who have been lacking since the EU referendum result.
“Low borrowing costs and a strong jobs market will reinforce the renewed sense of optimism many people are feeling.”