House Price Index

How much is your house worth? And what is happening to property prices in your development, your street, your neighbourhood – or the ones you would like to move to?

Britain’s obsession with house prices shows no signs of going away – we seem to be fixated on them whether they are going up, down or staying the same. So it is no surprise that so many information sources promise to give us the inside track on prices. Many of the property house price indices are well known and frequently quoted in news broadcasts and in newspapers. But others enjoy a lot less publicity – and the experts are divided on which are the most accurate.

If you can’t tell your regional Halifax index from your seasonally-adjusted Nationwide, your RICS from your Land Registry then this is the website for you. Here’s our independently researched guide to the market.

Confidence in housing market grows

Consumer confidence in the housing market has experienced a rise since February, new data shows.

According to figures from a leading housing site, 81.9 per cent of people expect house prices to rise over the next year, by an average of 6.4 per cent.

This is an increase from the 77.8 per cent who expected house prices to rise in the next 12 months in February, by an average of 5.9 per cent.

Chief executive of the site Warren Bright said that confidence in the housing market was "fairly buoyant", with a controlled slowing and a well-needed adjustment of balance between buyers and sellers being seen at the moment.

In February, seller confidence outweighed that of buyers, with ten per cent more sellers expecting prices to rise by two per cent more in value than buyers, although this month an almost equal proportion of buyers and sellers expect house prices to rise in the next year.

Mr Bright said: "People have faith in the value of bricks and mortar, and as long as the UK housing market continues to experience such drastic supply issues, this is unlikely to change significantly."

New government figures show that the number of households in England is set to increase by 223,000 a year between 2004 and 2026, another factor likely to keep an upward pressure on house prices and boost the value of investors' property portfolios.

House price growth at 9.9%

House prices rose by 1.8 per cent in February as the supply of property on the market fell, the latest figures reveal.

According to the monthly house price index from Halifax, annual price inflation remained at 9.9 per cent for the third month in a row, meaning the property portfolios of many buy-to-let investors will have increased in value.

The average house price is now £192,233, with a low supply of available property, both in terms of new homes being built and second-hand properties coming onto the market, pushing prices upwards, the report states.

A low supply of homes in relation to demand was also noted in research from estate agent Kinleigh Folkard & Hayward, which said that there had been a fall of 39 per cent in properties for sale in February compared to a year earlier.

However, if looked at on a quarterly basis, the Halifax figures show that the rate of house price inflation has more than halved, increasing by an average of 2.3 per cent in the last three months, compared to 4.7 per cent in the three months before that.

Chief economist at Halifax Martin Ellis commented: "A shortage of both new and secondhand properties available for sale has continued to push house prices up so far in 2007, particularly in London.

"However, there are some signs emerging that the increase in interest rates since last summer is dampening housing demand but this is yet to feed through to house prices."

Population trends predict house prices

Population movement around the UK could have an effect on house prices, according to a property website.

A leading property portal concluded that in seven out of ten cases, regional house price growth was linked to population growth, meaning that wise buy-to-let investors could have a new way to predict which areas are set for high growth.

Although there were some areas that did not bear out this trend, such as the north-east, when the region was taken out of the equation, property and house price growth showed links in 94 per cent of cases.

"While these population trends continue, our research suggests that the best performing regions which have been attracting the most migrants will continue to see house prices outperform over the medium term," said the property portal chief executive Warren Bright.

While the overall level of house prices was dependent on the wider economy, the strength of regional housing markets was down to population movement in a large part, he explained.

The study identified big cities like London - where it is seen as easier to find work - as popular destinations for immigrants moving to the UK, while for British city slickers tiring of the pace of urban life, popular places to relocate to included the south-west and Wales.


Neil Simpson is a former Personal Finance Journalist of the Year and writes regularly on property, mortgage and financial issues for the Mail on Sunday, City AM newspaper and many other publications.

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