UK house prices at highest level ever following ‘mini-boom’
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UK house prices increased by 3.8 per cent over the last year and are now at their highest level ever, according to the latest Halifax house price index.
The bank also recorded a 1.7 per cent lift in property values from June to July, with the average house price now standing at £241,604.
Halifax managing director Russell Galley said this data “adds to the emerging view that the market is experiencing a surprising spike post lockdown.
“As pent up demand from the period of lockdown is released into a largely open housing market, a low supply of available homes is helping to exert upwards pressure on house prices.”
Galley credited the government’s stamp duty holiday with helping boost the market, and said that the immediate future “looks brighter than many might have expected three months ago”.
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He acknowledged “a great deal of uncertainty around the lasting impact of the pandemic” however, adding: “as government support measures come to an end, the resulting impact on the macroeconomic environment, and in turn the housing market, will start to become more apparent.
“In particular, a weakening in labour market conditions would lead us to expect greater downward pressure on prices in the medium-term.”
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Lucy Pendleton of London agent James Pendleton predicts the traditional August lull will fail to materialise this summer due to the exceptional market conditions.
She said: “With most of the country taking a staycation this year, we expect activity to be strong throughout August as people take the opportunity to view and list properties while conditions are favourable.”
She added that the stamp duty freeze has “warded off the bargain hunters and gazunderers we were seeing during lockdown, as sellers have been less inclined to knock money off their properties now that there’s a stamp duty bonus on the table.”