Connect with us

Hi, what are you looking for?

Investing

Double-digit house price growth returns as ‘buoyant’ market keeps up pace

House prices unexpectedly returned to double digit growth last month as the property market kept up its “extremely buoyant” pace, new figures show.

Prices in November were 10% ahead of the same month last year, according to an index published by lender Nationwide – up slightly from 9.9% in October and beating expectations that growth would slow to 9.3%.

The latest increase took the average house price to £252,687, according to the index.

Britain’s housing market has been boosted by a stamp duty holiday that helped it recover from a slowdown early in the pandemic, with year-on-year price growth topping 13% in June this year, according to Nationwide’s index.

There have also been signs of some homeowners looking to trade short commutes to the office for more spacious homes further out of cities as the pandemic transforms working patterns.

Transaction volumes took a hit when the stamp duty break ended but they have already surpassed 2020 levels and prices have continued to push higher.

Nationwide’s chief economist Robert Gardner said prices were now almost 15% higher than when the pandemic first struck the UK in March last year.

“Activity has been extremely buoyant in 2021,” Mr Gardner said.

“Early indications also suggest that labour market conditions remain robust, despite the furlough scheme finishing at the end of September.

“If this is maintained, housing market conditions may remain fairly buoyant in the coming months, especially since the market has momentum and there is scope for ongoing shifts in housing preferences, as a result of the pandemic, to continue to support activity.”

But Mr Gardner added that the outlook “remains uncertain” with the impact of the Omicron variant of COVID-19 on the wider economy unclear, while higher inflation is dragging on consumer confidence and potential higher interest rates exerting a “cooling influence”.

He also cited the lack of affordability of homes, with house price growth outpacing income growth “by a significant margin”.

Martin Beck, senior economic advisor to the EY ITEM Club, said: “In theory, stamp duty returning to its pre-pandemic level on 1 October should have weighed on house prices.

“But while there have been some signs of cooling in housing market activity, any stamp duty effect on values appears to have been countered by positives such as changing housing preferences and a strong jobs market.”

The figures came as a separate forecast from property website Rightmove predicted that house prices would grow by 5% in 2022, slowing from this year’s increases.

The forecast sees prices driven higher by strong buyer demand meeting historically low availability of property.

But it also points to factors such as “increasingly stretched buyer affordability” as well as potential interest rate hikes, higher inflation and tax rises weighing on buyer sentiment.

Read more:
Double-digit house price growth returns as ‘buoyant’ market keeps up pace

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Investing

The national pig herd has lost-one tenth of all sows over the last six months, farmers’ associations have revealed, after breeders were forced into...

Investing

EasyJet plunged £213 million into the red in the Christmas quarter and is still burning through £150 million in cash each month, putting its...

Investing

A new range of healthy yet indulgent cookies will launch in Booths this month for just £1 per pack with the UK-born snacks by...

Investing

Payments firm Checkout.com has raised $1bn (£730m), giving it a $40bn (£29bn) valuation and crowning it the UK’s most valuable private fintech. The London-headquartered...

Investing

Sylvera, a UK-based startup that provides ratings for carbon offsets, has raised $32.6m (£24.1m) in a Series A funding round to accelerate and expand...

Investing

UK-based fintech Everything has raised €2m (£1.67m) to reinvent a decades-old financial product: premium bonds. The raise was led by a group of angel...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Investing

As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.