UK house prices rise at fastest pace in 15 years, says Halifax | housing market

According to Halifax, UK house prices are rising at their fastest pace since 2007, with typical property seeing its biggest annual cash gain in almost 40 years since the start of the lenders’ index.

Two years into the coronavirus pandemic, commentators say the housing market continues to defy economic conditions, with average property prices rising another 0.5% in February, equivalent to £370 per week.

It was the eighth month in a row that property values ​​had increased, bringing the annual rate of price growth to 10.8%, the highest figure since June 2007.

House price chart

The price of a typical home has increased by over £38,000 since February 2020, and in the last 12 months alone £27,200 has been added to the value.

“This is the largest one-year increase in cash in the index’s more than 39-year history,” a Halifax spokesperson said. It meant the average house price had hit “another new record high” of £278,123.

The squeeze on household finances, fueled by rising interest rates and inflation, does not yet seem to have weighed heavily on market momentum.

Real estate agents and others said a shortage of homes for sale continues to drive up prices, while the pandemic has prompted many people living in urban areas to consider moving to somewhere with more space. open, like a village or a small town in the countryside. or by the sea.

However, events in Ukraine should help dampen the market.

Halifax chief executive Russell Galley said: “The war in Ukraine is a human tragedy, but it is also likely to have effects on trust, trade and global supply chains.”

He said soaring oil and gas prices were an immediate consequence, meaning inflation in the UK – already at a 30-year high – would stay higher for longer, adding to pressure on the UK. already strained household incomes. Meanwhile, further interest rate hikes seemed likely in the near term.

“These factors are expected to weigh on buyer demand as the year progresses, with market activity likely returning to more normal levels and a slowdown in house price growth expected,” Galley said.

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Wales has been the best performing nation or region in terms of property price growth, with prices generally up 13.8% over the past year, while the South West England followed closely at 13.4%. In contrast, the figure for London was 5.4%.

Lewis Shaw, who founded mortgage brokerage Shaw Financial Services, said the UK property market had “gone down the rabbit hole“, adding: “Economic logic suggests prices should fall, but the surreal lack of stocks keeps values ​​up.

Sarah Coles, analyst at investment firm Hargreaves Lansdown, said: “House prices cannot escape reality forever. Eventually buyers will have to deal with life becoming more expensive and unpredictable, and we will see these record price increases slow significantly.

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Raymond I. Langston