House prices rose by 2.1% in January, marking a record start to the 2007, according to the DCLG’s most recent data. Since it began five years ago, the DCLG house price index has never recorded such healthy growth at the start of the year ? in January 2006 house prices rose by just 1.2%.
In London prices rose by more than 3% this January, according to the department’s figures, while the East, North West, South East and South West all recorded gains of more than 2%. Meanwhile price growth in Northern Ireland reached 42.5% ? the fastest growth rate seen for any month since the DCLG index started.
Property experts are, however, still expecting a slowdown later in the year. ‘Given the normal lags in the house buying process, the full effects of higher interest rates are yet to be seen in the house price data,’ said Kelvin Davidson from Capital Economics. ‘Looking ahead, we continue to expect higher interest rates to take a greater toll on the housing market in the coming months, with activity levels and price pressures likely to be markedly weaker by the end of the year’.
But for thousands of home owners across the country, it is a question of seeing is believing. The annual rate of house price growth has increased in every region since October, with no sign of abating.