House prices in Britain increase again

Asking prices for British houses put on sale have extended a rise which began after Prime Minister Boris Johnson’s election victory in December, property website Rightmove said.

It comes as a gauge of how people in Britain feel about their household finances hit its highest level on record this month, the latest sign of a confidence bounce.

Rightmove said average asking prices of property marketed between January 12 and February 8 rose by a monthly 0.8%, slower than a 2.3% jump in the previous Rightmove report but enough to take prices close to their all-time high.

The number of sales agreed was up by an annual 12.3% at the national level and by 26.4% in London.

“It’s the first time for over a year that we have seen any sign of a return of seller confidence, albeit lagging behind the surge in numbers of early-bird buyers,” Miles Shipside, Rightmove director, said.

There have been other signs of a quickening in the housing market since the UK election on December.

Last week the Royal Institution of Chartered Surveyors said house prices rose at the fastest pace in nearly three years in January.

Meanwhile, the IHS Markit Household Finance Index jumped to 47.6 in February from 44.6 in January, the highest index reading since the survey began 11 years ago.

“Our latest household finance report signals a number of developments that should keep the Bank of England doves at bay and build optimism towards the UK’s immediate economic prospects,” Joe Hayes, an economist at IHS Markit, said.

Mr Johnson’s spokesman said Britain does not need any special arrangements in its future relationship with the EU, adding that it wants a trade agreement similar to other deals the EU has struck.

The advisor, David Frost said that Britain wants a relationship based on friendly cooperation and that it was ready to start negotiations with the EU now.

The Bank of England last month decided not to cut interest rates as it saw early signs of a recovery in the economy after a slowdown in late 2019.

Bank of England governor Mark Carney said last week that there had been a bounce in business confidence and to “some extent a firming of consumer confidence”.

The IHS Markit survey showed households expected a further slowing of inflation and a pick-up in house prices while worries about job security eased.

However, the proportion of respondents expecting a rate cut by the Bank of England rose to 27%, its highest since the last time the central bank cut borrowing costs in August 2016.

Reuters