House prices up but are falls on the horizon?

House prices defied the economic downturn last year to rise 1.1 per cent, boosted by a second-half surge in demand from homebuyers. The annual increase was the first rise over 12 months that Halifax, the mortgage lender, has recorded since March 2008. The latest rebound continued in December, with prices rising by 1 per cent over the month, the sixth monthly rise in a row, taking house prices to an average of £169,042 — 9.4 per cent higher than in April last year, when the market bottomed out. Despite the apparent buoyancy of the market, Halifax, now part of Lloyds Banking Group, gave a cautious outlook for the year ahead, warning that it expected house prices to remain flat during 2010.