Cheap mortgage rates and lack of supply cause a rise in house prices

UK house prices picked up in April following a fall in values the previous month, according to the country's biggest mortgage lender.

The Halifax, part of Lloyds Banking Group, said property values rose by 1.1% in April compared with March when prices fell 1.25%.

The annual rate of growth almost doubled with house prices up 5% compared to a year earlier when house prices dropped.

The average home is valued at £236,619.

Compared with 10 years ago, which was the trough in house prices amid the financial crisis, the typical UK property has risen in value by £81,956, the equivalent of a 4.3% average annual increase.

Yet, analysts still say the latest estimate from the Halifax should be treated with some scepticism.

"One explanation for ricocheting growth figures like this is persistently low stock levels. In sought after areas, this can lead to demand being supercharged one minute and gone the next, with price rises coming in waves as brief competitions for limited numbers of homes come and go," said Lucy Pendleton, founder director of estate agents James Pendleton.

"Even so, the Halifax index's behaviour so far in 2019 has been unusual to say the least."

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "The lack of supply and properties coming to the market is most likely continuing to support property prices, while cheap mortgage rates continue to attract those who are ready to take the plunge."

Source: Kevin Peachey for BBC Property news feed

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