The latest figures from Halifax for the month of August show that house price growth has hit its highest level since October of last year, with an annual increase of +2.6% and a monthly jump of +1.1% in August alone. making the average property price across the UK £222,293. The quarterly rise for June,
This strong growth now makes the average property price across the UK £222,293 and was largely unexpected due to seasonality and its impact on the market. During the summer months, it is not unusual for the market to slow as many turn their minds from selling to holidays. Yet more evidence that the market has well and truly shaken the Brexit hangover that has seen erratic market movement over the last year or so.
The annual rate of growth increased from 2.1% in July to 2.6% in August with the average house price now £222,293, which is just above the previous high of December 2016 (£222,190).
Recent figures for mortgage approvals suggest some buoyancy may be returning, possibly on the back of strong recent employment growth, with the unemployment rate falling to a 42 year low. However, wage growth is still lagging increases in consumer prices, which is likely to add pressure on household finances and increase affordability challenges for some buyers.
House prices should continue to be supported by low mortgage rates and a continuing shortage of properties for sale over the coming months.Russell Galley
Home sales have for the seventh consecutive month exceeded 100,000, with activity in the three months leading up to June enjoying a 10% increase to the same time a year before. A higher number of mortgage approvals, up 5.2% to 68,700 between June and July, indicate a positive number of home sales gone to completion. However, the supply of homes needed continues to have difficulty meeting the demand required in the market.
Rather than returning from the holiday period sunburnt and bleary-eyed, the UK housing market has defied the usual slower summer trends to show strong price growth on a monthly and annual basis.
Although the same can’t be said for wage growth, mortgage rates still remain low and this, coupled with the ongoing shortage of stock and high volume of sales, should see UK house prices continue this upward trajectory heading towards Christmas.
This initial increase puts the market in good stead despite a rough ride over the last year and we should now see some degree of normality return as we see out 2017.Russell Quirk