UK house prices saw their highest month-on-month increase for three years in March, bolstered by the rising value of homes in the capital.
The findings, from a survey by property analysis firm Hometrack, revealed that house prices climbed by 0.3% between February and March 2013, the highest increase since March 2010.
In London this increase was even more marked, with house prices shooting up by 0.7% month-on-month.
Despite this significant increase in property values across the month, house prices remained stagnant year-on-year. However, this is the first time that property prices haven’t dipped since March 2010.
This month also saw price increase in three-fifths of London postcodes in March, with houses on sale taking just five weeks to be snapped up by would-be buyers – the shortest time period since October 2007.
The Government’s £80bn Funding for Lending Scheme (FLS) is said to have boosted the number of loans available to would-be buyers, while the Chancellor’s recent announcement that the Government will guarantee £130bn worth of mortgages is set to act as a further boost to the housing market.
Richard Donnell, director of research at Hometrack, argued that the outlook for the UK’s housing market was mixed:
“Looking ahead, the continuation of the FLS together with Budget initiatives aimed at supporting lending and demand for new housing, will only serve to support pricing levels.
“The general improvement in market sentiment on the back of rising prices will be welcomed across the housing industry.
“However, while scarcity of homes, support for lending and new housing will all act as a support to pricing levels, the problems of affordability and deposit levels still remain serious impediments to a full blown housing market recovery.”