Published: Thu, August 09, 2018
Economy | By

United Kingdom house prices jump in July by more than expected - Halifax

United Kingdom house prices jump in July by more than expected - Halifax

The Halifax's latest survey echoed that of rival Nationwide, which also reported a pick-up in the annual rate of price growth in July.

House prices rose at their fastest rate since November last month as rising wages helped to alleviate the pressure on household budgets.

House prices grew 1.4 percent month-on-month in July, faster than the 0.9 percent rise in June.

The annual pace of house price growth rose 3.3%, smashing economists' forecasts for a 2.6% increase, helping average prices hit a new record high of £230,280.

The increase pushed house price inflation back above wage growth, which is now at about 2.5% a year, and comes just days after the Bank of England raised interest rates.

"A lack of housing continues to challenge many would-be buyers".

But Halifax said that transaction activity "remains soft" and that it expected the number of mortgage approvals to be broadly flat during 2018.

"With regards 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", Galley added.

'It is nearly as if the north/south divide is working in reverse with more activity outside rather than inside the capital, ' he added.

Russell Quirk, founder and chief executive of Emoov, says the current price path for the market as a whole favours both existing owners and aspiring buyers. Viewings are up but it is hard to obtain commitment as political and economic uncertainty remain.

'As with growth in house prices, an interest rate increase is actually the sign of a robust economy, therefore coupled with today's news, one might suggest that whilst the market isn't fizzing away at top speed, it's ticking over nicely through the summer months'.

"The modest momentum could also be given a short-term boost by last week's increase in interest rates, which, rather than cooling the market, may spur previously hesitant buyers into action during the typically busy "back to school" season next month".

"Prices are up annually and while a slightly tired market hasn't narrowed the unaffordability gap over the past year or two, it has at least stalled it from widening somewhat".

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