UK house prices rise at fastest rate in 15 years, says Halifax

[dutchman]

Average price hits £278,123 as property market continues to defy economic conditions



UK house prices are rising at their fastest rate since 2007, according to Halifax, with the typical property notching up its biggest annual cash gain in the nearly 40 years since the lender’s index began.

Two years on from the start of the coronavirus pandemic, commentators say the housing market is continuing to defy economic conditions, with average property prices rising by another 0.5% in February, equating to £370 a week.

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

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

“This is the biggest one-year cash rise recorded in over 39 years of index history,” a Halifax spokesperson said. This meant the average house price had hit “another new record high” of £278,123.

The squeeze on household finances, fuelled by rising interest rates and inflation, does not as yet appear to have done much to dent the market’s buoyancy.

Estate agents and others have said a shortage of homes for sale is continuing to drive prices up, while the pandemic has prompted many people living in urban areas to look at relocating somewhere with more open space, such as a village or small town in the countryside or by the sea.

However, the events in Ukraine are expected to help put the brakes on the market.

Russell Galley, Halifax’s managing director, said: “The war in Ukraine is a human tragedy but is also likely to have effects on confidence, trade and global supply chains.”

He said soaring oil and gas prices were one immediate consequence, meaning that UK inflation – already at a 30-year peak – would remain higher for longer, adding to the squeeze on already stretched household incomes. Meanwhile, further interest rate increases looked likely in the near term.

Wales was the strongest-performing nation or region in terms of house price growth, with prices typically up by 13.8% over the past year, while south-west England was close behind at 13.4%. By contrast, the figure for London was 5.4%.

Lewis Shaw, who founded the mortgage broker Shaw Financial Services, said the UK property market had “gone down the rabbit hole”, adding: “Economic logic suggests prices should be coming down but the surreal lack of stock is keeping values buoyant.”

[rebbonk]

Housing is a bubble and like all bubbles, at some point, it will burst.

If you want to play with this particular bubble, you need to ensure you aren't left 'holding the baby' when it bursts. Plenty of people are going to get badly burned.

[dutchman]

UK house prices grow at fastest rate for 17 years



UK house prices grew in March at the fastest rate since 2004, continuing the ascent to new record levels – with the price of an average home now a fifth higher than at the start of the coronavirus pandemic.

Prices rose by 14.3% in the year to March, the strongest pace of increase since November 2004, when the UK experienced a housing boom that preceded the financial crisis, according to Nationwide, the UK’s largest building society.

The price of an average UK home hit £265,312, more than £33,000 higher than March 2021. Price rises were evident across the country, with prices in Wales increasing by 15% over the year. House price growth accelerated in every region of England and Scotland.

Detached homes have gone up nearly £68,000 in price since the start of pandemic, a 22% rise, as people working from home sought out bigger properties, while average flat prices have increased by £24,000, or 14%.

The near-relentless rise in house prices has come despite the economic damage from the pandemic, which caused a deep slump in activity. However, government wage support schemes and savings during lockdowns have supported the housing market. Nationwide estimated that reduced spending has meant that households were on average able to save £190bn more than would have been expected before the pandemic – £6,500 a household, albeit unevenly spread.

The government also intervened with stamp duty cuts, which subsidised the housing industry and helped to keep prices rising as soon as the market unfroze.

[rebbonk]

I personally need this bubble to last for another 12 months due to some investments.

It can do what it likes after that because I cash out.