Halifax has reported that house prices in December were 4.0% higher than in the same month a year earlier.
On a monthly basis, house prices rose by 1.7%.
In the latest quarter (October to December) house prices were 1.0% higher than in the preceding three months (July to September).
The average house price in December was £238,963.
Russell Galley, managing director of Halifax, said: “Average house prices rose by 4% over 2019, at the top of our predicted range of 2% to 4% growth for the year. This was driven by a monthly gain of 1.7% in December which was the biggest monthly increase of 2019, pushing up the year-on-year growth rate and reflecting that December 2018 was a particularly weak month.
“Looking ahead, we expect uncertainty in the economy to ease somewhat in 2020, which should see transaction volumes increase and further price growth made possible by an improvement in households’ real incomes.
“Longer-term issues such as the shortage of homes for sale and low levels of house-building will continue to limit supply, while the ongoing challenges faced by prospective buyers in raising deposits will serve to constrain demand. As a result, we expect a modest pace of gains to continue into next year.”
Jonathan Hopper, managing director of Garrington Property Finders, added: “After several false starts, December’s solid jump in house prices propelled the property market to a surprise sprint finish in 2019.
“Coupled with encouraging transaction data – the number of homes changing hands in November rose to its highest level in more than two years – this Halifax snapshot of prices gives the clearest sign yet of a market acclerating back towards normality.
“But two big questions remain for both buyers and sellers pack as viewings begin again in earnest – will the momentum sustain, and what is a fair value?
“There’s a risk that some previously embattled sellers will get carried away, and base their pricing on hope and expectation rather than the current reality.
“On the other side of the coin, buyers will need to recognise that as the market begins to unclog, being overly aggressive or hesitant with their offers could lead them to miss out.”
