House price increases slow and still below 2007 high

House prices increased 1.6 per cent in the three months to October compared with 2.1 per cent in each of the previous four months, Halifax revealed.

Martin Ellis, housing economist of Halifax, said despite the slowdown in the quarterly rate, the annual rate continued to rise with prices in the three months to October - 6.9 per cent more than in the same three months last year.

He said: “Demand has increased this year, putting upward pressure on house prices and increasing levels of activity.

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“Low interest rates, and higher consumer confidence supported by the increasing evidence that a sustainable economic recovery may now be underway, are helping to increase housing demand.

“Schemes, such as Funding for Lending and Help to Buy, also appear to have boosted demand.

“Despite increases in the past year both house prices and sales remain below the levels reached at the height of the last housing market cycle in 2006 to 2007.

“Sentiment towards selling has also improved in recent months in response to the pick-up in the market, which should help to increase the availability of properties on the market over the coming months.”