House prices continue rising Despite tighter mortgage availability, as a result of the Mortgage Market Review (MMR), which has forced lenders to be more analytical regarding medium and longer-term affordability of mortgages for borrowers; the average house price across the UK rose by just under 10% in 2014. Average prices were recorded as being 0.7% higher in December from the previous month and the annual price increase was reported as 9.8% by the Office for National Statistics (ONS). This equated to an average house price in the UK of £272,000. However, this is still below the all-time high of £274,000 recorded in August 2014. December also saw record highs for average house prices in Wales, the East, the West Midlands, the South West, and the South East. Every region saw higher prices in 2014, but as always, there were wide regional variations, as Wales and the North West of England recorded gains of 4%, whilst London saw price increases of 13.3% to £502,000. As impressive as these figures are, the December figures here were still below the peak reached in August 2014. Having said that, London prices are now more than 30% above the previous property price peak recorded before the Great Recession in 2008 and still substantially above any other region in the UK. On the macro front, England recorded price gains of 10.2%, to reach £285,000, Wales saw a 4% rise to £173,000, Scotland 5.5% to £193,000 and even Northern Ireland reporting a 4.9% increase to £142,000. Despite these rising prices nationally, 2014 saw the most first-time buyers enter the property market for seven years. These buyers have had to find an additional 9.5% for a property in December 2014 than they would have paid a year ago. The average price paid across the UK by those first-time buyers was reported by the ONS as being £208,000. Markets (February) (Data supplied by the Outsourced Marketing Department) The FTSE100 finally reached a new zenith on February 24th, as it surpassed the previous closing high of 6,930 – last reached way back in December 1999 – to reach 6,949.63.
Closing fractionally down though on this high, at 6,946.66, up 2.9% at month end, it was buoyed by more positive news coming out of Greece, relieving the fear they would be forced to exit the Euro currency bloc, and an improving UK economic outlook, including low inflation, rising average wages and reduced unemployment levels. The wider FTSE250 also gained 5.9% to 17,273.82 and the junior AIM was up 3.5% to 714.5. The Eurostoxx50 saw continuing support, closing at 3,599.0 for a 7.67% rise. Across the pond, both the Dow Jones Index and the S&P500 touched new all- time highs in February, closing at 18,132.7, up 5.6% on the month and 2,104.5 up 5.5% respectively, whilst the Nasdaq closed February up 7% at 4,963.53. Meanwhile, the Japanese Nikkei225 Index continued its bull run, gaining 6.4% to 18,797.94. The foreign exchange markets saw increased volatility, as given the fiscal and political unrest within the eurozone, especially concerning the still possible Greek exit from the currency agreement, it is no surprise that Sterling has appreciated against the Euro currency to a new seven-year high. As at the close of the month, Sterling was sitting at €1.38, up 2.8%, which is its strongest rate since January 2008. At the same time Sterling also appreciated against the mighty US Dollar to $1.54, up 1.99%. The Euro also struggled against the US Dollar, dipping to $1.12. One of the factors surrounding the Euro’s decline was the announcement by the European Central Bank (ECB) of its €1.1 trillion quantitative easing programme. Gold was one of the commodities to lose ground in the month, dipping by 4.6% to $1,214.0 an ounce, while black gold – oil – saw a recovery in price of 17.2% to finish February at $62.12 a barrel, as measured by the Brent Crude benchmark. Download full report here

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