Housing market experts surprised as index shows 2.2% price jump in December

House prices recorded a surprise jump in December, according to an index.

Halifax said house prices increased by 2.2% month on month in December, following a 1.2% fall in November.

Across the UK, property values were up by 1.3% year on year to reach £229,729 on average.

The month-on-month figures from Halifax are in contrast to a separate index from Nationwide Building Society, which said last week that house prices were down by 0.7% month on month in December.

Howard Archer, chief economic adviser at EY Item Club, described Halifax’s figures as a “major surprise”.

He said: “It is notable that December’s monthly increase of 2.2% followed a drop of 1.2% in November.”

He added that it is also notable that December’s month-on-month spike in house prices reported by Halifax is “markedly at odds” with some other surveys and data which have pointed “to stuttering house market activity and prices late on in 2018, with heightened Brexit uncertainties very possibly having an impact”.

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “Volatility shouldn’t distract from the weak underlying trend.”

He continued: “The 1.3% year-over-year growth rate is a much better guide to the underlying trend, sitting between other estimates of price gains.”

Russell Galley, managing director, Halifax, said: “In 2019, we’re expecting continued stability in house prices with between 2% and 4% price inflation.

“This is slightly stronger than 2018, but still fairly subdued by modern comparison.

“However, this expectation will clearly be dependent on the Brexit outcome.”