The Halifax House Price Index shows that prices grew by 3.3 per cent annually in July, the largest increase since November 2017. This leaves the average house price at its highest on record – £230,280.
On a monthly basis this figure stands at 1.4 per cent, a marked contrast to the preceding month, in which prices increased by just 0.3 per cent.
The report does point out, however, that although mortgage approvals rose for the second month in a row, sales fell by 3 per cent in June, and that this flat activity is likely to continue.
Halifax managing director Russell Galley says: “While the quarterly and annual rates of house price growth have improved, housing activity remains soft. Despite the recent modest improvement in mortgage approvals, the latest survey data for new buyer enquiries and agreed sales suggest that approvals will remain broadly flat until the end of the year.
“With regard to the recent rise in the Bank of England Base Rate, we do not anticipate that this will have a significant effect on either mortgage affordability or transaction volumes.”
Foundation Home Loans marketing director Jeff Knight says: “With the Bank of England’s decision to raise interest rates for only the second time in a decade, households feeling the pinch may be concerned that this could be the beginning of a new era. That said, taking into account ongoing Brexit concerns, changes to stamp duty and higher tax impositions, for buy-to-let properties, an additional 0.25 per cent is only part of the equation that is at play for property owners, would be property owners and landlords alike.”
North London estate agent and former RICS residential chairman Jeremy Leaf comments: “this [growth] was mainly due to shortage of stock and continuing low mortgage rates, as we have found on the high street that many buyers have already factored in the increase in interest rates. It is almost as if the north/south divide is working in reverse with more activity outside rather than inside the capital.
“There is still no clear pattern to the market after June saw the slowest growth for five years. Viewings are up but it is hard to obtain commitment as political and economic uncertainty remain,” he adds.
Resi.co.uk founder and chief executive Alex Depledge comments that the price increase is, “likely to mean further stagnation in the property market. Prospective buyers and sellers planning to move up or down the ladder will no doubt be concerned that property chains will be slow moving, with transactions becoming delayed or cancelled.”
Meanwhile, Garrington Property Finders managing director Jonathan Hopper claims that “these surprisingly strong numbers” are down to a “tussle between pent-up demand and chronically low supply.”
