The latest figures from Halifax have indicated to property expert Simon Morris that UK residential property prices registered steady growth in the second quarter of 2015.
House price growth
The Halifax property price index shows that UK house prices increased 3.3% during the second quarter of 2015. This means that the average price for a house in the UK now rests at £200,280.
Deeper analysis shows that residential property prices in the UK are 9.6% higher in the three months to June 2015 than they were in the corresponding three months of 2014. This figure means that the quarterly increase rate for UK residential property values has hit its highest peak since September 2014.
Furthermore, statistics from HM Revenues and Customs (HMRC) indicates that between April and May 2015, home sales increased 1%. Meanwhile, these figures illustrate that home sales are 0.5% higher in the quarter between March and May 2015 than they were in the previous quarter, but they still sit 4.2% lower than they did in the corresponding quarter of 2014.
Low housing stock
Halifax housing economist Martin Ellis attributed house price growth to the fact that the number of properties currently for sale in the UK rests at an all-time low. He was quoted by Property Wire saying:
“This shortage has been a key factor maintaining house price growth at a robust pace so far in 2015. Economic growth, higher employment, increasing real earnings growth and very low mortgage rates are all supporting housing demand with signs of a recent modest pick-up in demand.”
Dragon Property Finance CEO Jonathon Samuels also spoke out to suggest how the residential property sector may continue to expand throughout the rest of 2015. He said: “With economic growth stronger than expected during the first quarter, a buoyant jobs market and people generally better off, you would expect the market to continue to improve throughout the rest of 2015, if at a more moderate rate compared to recent years.”
Invest in buy-to-let?
This may lead investors to believe that now is the time to withdraw their pensions to invest in buy-to-let residential property, however Simon Morris would urge caution. There are many risks to buy-to-let investment; potential investors need to calculate risk vs. reward to determine the true value of this investment strategy.
Simon would also advise investors who are thinking of pursuing this option to download his latest guide, The Advantages and Pitfalls of Investing Your Pension in Property. This comprehensive guide provides investors with all the information they need to determine whether they should take advantage of pension reform to invest in residential property.