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UK house prices grow at fastest rate in five years

rising-house-prices

Britain’s biggest mortgage lender, Halifax, has said that house prices are growing at the quickest pace in five years.

A fresh surge in buying was spurred last month after the Treasury extended the stamp duty holiday.

Halifax figures show that the average cost of a home grew by 1.4% in April, with the average sale price now at £258,000 - a record high.

According to Halifax, almost £20,000 has been added to the average house price since April 2020.

The bank expects demand to remain high over the next few months despite the stamp duty holiday being phased out from June to September.

However, it warned that house price inflation is likely to slow down towards the end of the year as the government’s furlough scheme comes to an end.

Halifax’s managing director, Russell Galley, said: “The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the government scheme.

“The influence of the stamp duty holiday will fade gradually over the coming months as it’s tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market.”

EY Item Club economist, Howard Archer, said: “The market is likely to have near-term support from the extension of the full stamp duty threshold increase from end-March to end-June and then partially to end-September, and from the introduction of a mortgage guarantee scheme for people with low deposits.

“Meanwhile, the market will also be aided by unemployment rising less than previously expected due to the extension of the furlough scheme to the end of September.”

Managing director of estate agent Fine & Country, Nicky Stevenson, said: “The air is thin up here and, even though all buyers know in their hearts that things will calm down and growth will slow later this year, they are still frantically bidding up prices.

“Incredibly, the stage is set for this rally to continue and the market may be about to get its own vaccine bounce, like the one delivered to Boris Johnson this week. That broader optimism is still being complemented by improving weather, the imminent loosening of Covid restrictions, low interest rates, a yearning for more space and the fact that many homeowners have saved thousands of pounds not being able to go anywhere.”

Harry Pererra
Harry Pererra

Harry turns on his experience in journalism and programming to write about the latest news in the world of tech and the environemtn. When he isn’t writing for usave he is working towards his Blue Belt in Brazilian Jiu Jitsu, and prefers dogs to cats.

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