July was a good month for house prices; the latest figures released by Halifax show that property has gone up 10.2% when compared to a year earlier. This is the biggest annual increase since September 2007.
It seems that while supply remains relatively scarce, demand continues. This demand is supported, by and large, to the prosperous economic recovery, combined with a rise in employment, increased consumer confidence and lower mortgage rates.
According to Halifax, the monthly increase was 1.4% compared with June. This makes the average home worth around £185,000.
Halifax’s figures have caused a bit of a stir, as other lenders have released figures showing that house prices have started to moderate. Nationwide, for example, has estimated that the annual price rise has slowed down from 11.8% in June to 10.6% in July.
Why are the figures different? Ultimately, it’s down to how it’s calculated; Halifax compares the previous three months with the same timeframe a year earlier. This gives a smoother comparison compared to Nationwide, which directly compares the equivalent months.
According to the Land Registry, around 70% of the ten regions they measured in England and Wales showed a monthly decline in prices.
It’s important to note that short-term price changes are often pretty volatile. Although prices are likely to continue rising over the next few months, there’s likely to be some form of moderation compared to the peak levels we’ve seen recently. What are your thoughts?