House prices rise 2.2% in March

4 April 2012

House prices rose by 2.2% in March, meaning the average home is now worth £163,803, according to Halifax.

However, prices are still 0.6% lower than they were a year ago and they've fallen 0.1% over the last quarter.

"House prices in the first quarter of 2012 were little changed compared with the final quarter of 2011," says Martin Ellis, housing economist at Halifax.

"The underlying trend therefore indicates broad stability in UK house prices. We continue to expect little overall movement in prices this year provided that the UK economy does not suffer a pronounced weakening."

The sharp rise in house prices in March has been put down to efforts by first-time buyers trying to move quickly in order to complete on purchases before the stamp duty holiday came to a close at the end of the month.

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Looking at the bigger picture, Halifax says that volatility in house prices in recent months is "a result of the historically low level of sales volumes," but transaction levels are now starting to pick up. Completed sales have risen to their highest levels since late 2009 with a seasonally adjusted 81,000 sales in both January and February - 14% higher than in the same period last year.

However, again this rise may simply be a result of first-time buyers acting to beat stamp duty. On 24 March the government ended the stamp duty holiday that had meant any first-time buyer purchasing a house worth under £250,000 was exempt from paying the tax.

The Halifax figures report a very different picture to the Nationwide figures that came out last week. Nationwide reported a 1% fall in house prices in March.

"Taken at face value, the almost endless stream of house price indices seems to be suggesting that house prices are yo-yoing up and down. One set of date is up, the next is down," says Liya Fateh, director of estate agent review website

"With such a lack of consistency in the numbers, both buyers and sellers should approach them with caution. The volatility is down to a sad but inescapable fact - the number of property sales is very low."

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