According to the Halifax, house prices continued to gain ground last month. A 0.4 percent monthly increase was less than half of the market consensus but still the fifth successive increase and further evidence of a housing market that has turned the corner. Annual inflation slid from 2.3 percent to 1.7 percent but this just reflected negative base effects.

In fact, the quarterly change, the best guide to underlying developments, climbed from 2.5 percent to a very solid 2.9 percent and the average price of a home is now only around £1,800 off the peak seen in June 2022. Even so, with expectations for a lower Bank Rate being pushed further out, the Halifax remains cautious about the outlook and still sees a possibility that the market could lose momentum later in the year.

That said, today's report only trims the UK RPI to 21 and the RPI-P to 25. Both values show overall economic activity still running quite well ahead of forecasts and so provides further reason for expecting no early move by the BoE.

Prices are expected to climb a further 0.9 percent on the month after a surprisingly strong 1.3 percent rise in January.

The Halifax House Price Index (HPI) is the UK's longest running monthly house price measure with data covering the whole country going back to January 1983. The index is based on the largest monthly sample of mortgage data, typically covering around 15,000 house purchases per month, and covers the whole calendar month. In March 2016 Markit announced that it would be acquiring the Halifax HPI from Lloyds Banking Group. Halifax continues to publish the index on behalf of Markit and both the name and the basic methodology remain unchanged. However, in May 2020, the annual growth measure was changed from the average of the last three months to just the latest month.

Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can damp housing starts. Changes in home values play key roles in consumer spending and in consumer financial health. During the first half of this decade sharply rising home prices boosted how much home equity households held. In turn, this increased consumers' ability to spend, based on wealth effects and from being able to draw upon expanding home equity lines of credit.