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House prices rise in December 2004 reveals Halifax House Price Index

12-Jan-2005

Though Quarterly growth is at its lowest since 2000

"House prices rose by 1.1% in December following successive monthly declines in October and November. Overall, prices in the final quarter of 2004 were 0.1% higher than in the previous quarter. This was the smallest quarterly gain since 2000 Quarter 2" notes Martin Ellis, Chief Economist.

He continues: "The significantly sharper house price rises in northern Britain in 2003 and 2004 compared with southern England have reduced the north/south house price divide. The differential ... has fallen by £15,000 from a record £99,000 in early 2003 to £84,000."

The 0.1% national house price increase in Q4 2004 confirmed the continuing downward trend in house price inflation. Regionally, the three northern English regions had the biggest British price rises in the fourth quarter:

• North West: 3.0%
• Yorkshire and the Humber: 1.2%
• North: 0.7%.

Other regions prices fell during the quarter with the biggest declines being:

• Wales: -6.2%)
• South East: -1.6%
• London: -0.5%

The continuing signs of a genuine slowdown are likely to help remove pressures on the Bank of England to raise interest rates again. Halifax believe that base rates have peaked at 4.75% and they will end the year at 4.25%.