UK house prices jump unexpectedly in January: Halifax

[LONDON] British house prices spiked unexpectedly last month, recording their biggest monthly increase since May 2014, but mortgage lender Halifax said that it expected a broader slow down in house price rises to persist this year.

Halifax said that house prices rose by 2.0 per cent in January, up from a 1.1 per cent increase in December and far outstripping the 0.1 per cent average increase forecast in a Reuters poll.

Prices in the three months to January were 8.5 per cent higher than a year earlier, compared with a 7.8 per cent annual increase in the three months to December.

"These improvements may indicate that the recent declines in mortgage rates, the reform of stamp duty and the first increases in real earnings for several years are providing a modest boost to the market," Halifax housing economist Martin Ellis said.

However, he added that January was also a month when house prices could be particularly volatile due to low volumes, and stuck with a forecast for house price growth to slow over 2015 as a whole.

REUTERS