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Housing market ‘set to record its strongest year since 2007’

The housing market is set to record its highest level of sales this year since 2007, according to a property website.

Around 1.5 million sales will have taken place across the UK in 2021, Zoopla predicts.

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It added that housing transactions are expected to decline to 1.2 million in 2022, in line with the long-run average, but still relatively high compared to the past decade.

The impact of the pandemic on the housing market has further to run but at a less frenetic pace

Richard Donnell, Zoopla

Richard Donnell, from Zoopla, said: “2021 is set to be a record year for the housing market with the most moves by homeowners since 2007 and nearly £500 billion of home sales.

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“The impact of the pandemic on the housing market has further to run but at a less frenetic pace.

“We expect the momentum in the market to outweigh some emerging headwinds from higher living costs and the risk of higher mortgage rates.

“The latest data shows a turning point in the rate of house price growth, which we expect to slow quickly with average UK house prices up 3% by the end of 2022.”

Source: Shropshire Star

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Halifax: House prices reach record high

UK house prices rose by 1.7% in September, equating to an increase of £4,400 to the value of the average property, according to the latest Halifax House Price Index.

This means that UK house prices are now at a record high of £267,500.

This month-on-month rise is the strongest increase since February 2007 and ups year-on-year house price inflation up to 7.4%.

This also reversed the recent three-month downward trend in annual growth, which had peaked at an annual rate of 9.6% in May.

Wales continued to record the strongest house price inflation of any UK region or nation, with annual growth of 11.5% in September (average house price of £194,286).

Scotland also continues to outperform the UK national average, with growth of 8.3% (average house price of £188,525).

In both nations, the equivalent stamp duty holidays came to an end at an earlier date.

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The South West remained the strongest performing region in England, with annual house price growth of 9.7% (average house price of £276,226).

The North West saw the next biggest increase, with house prices up by 9% year-on-year (average house price of £201,927), marginally ahead of Yorkshire and Humber at 8.9% (average house price of £186,815).

The weakest performing regions in terms of annual house price inflation are all to be found in the South and East of England, though these are also the areas with the highest average UK house prices.

Eastern England has seen annual growth of 7.2% (average house price of £310,664) while in the South East it is 7% (average house price of £360,795).

Greater London remains the outlier, with annual growth of just 1% (average house price of £510,515), and was again the only region or nation to record a fall in house prices over the latest rolling three-monthly period (0.1%).

Russell Galley, managing director of Halifax, said: “While the end of the stamp duty holiday in England – and a desire amongst homebuyers to close deals at speed – may have played some part in these figures, it’s important to remember that most mortgages agreed in September would not have completed before the tax break expired.

“This shows that multiple factors have played a significant role in house price developments during the pandemic.

“The ‘race-for-space’ as people changed their preferences and lifestyle choices undoubtedly had a major impact.

“Looking at price changes over the past year, prices for flats are up just 6.1%, compared to 8.9% for semi-detached properties and 8.8% for detached.

“This translates into cash increases for detached properties of nearly £41,000 compared to just £6,640 for flats.

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“Against a backdrop of rising pressures on the cost of living and impending increases in taxes, demand might be expected to soften in the months ahead, with some industry measures already indicating lower levels of buyer activity.

“Nevertheless, low borrowing costs and improving labour market prospects for those already in employment are likely to continue to provide support.

“Perhaps the biggest factor in determining the future of house prices remains the limited supply of available properties.

“With estate agents reporting a further reduction in the number of houses for sale, this is likely to underpin average prices – though not the recent rate of price growth – into next year.”

Mike Scott, chief analyst at Yopa, added: “The Halifax House Price Index for September shows that there was a large monthly increase in house prices as we reached the final end of the stamp duty holiday, with average prices up by 1.7% for the month and the annual rate of increase rising to 7.4%.

“The mortgage approvals included in the September figure largely relate to purchases that will complete in later months and not benefit from any tax saving, so this is in effect already a post-tax-holiday figure.

“It is therefore further evidence that the withdrawal of the tax savings will have little effect on the over-heated housing market, which is still being driven by a severe shortage of homes for sale, good mortgage availability at record low interest rates, strong wage growth, pandemic-induced lifestyle changes and the involuntary savings built up by many during the lockdowns.

“Yopa thus expects the current strong rate of price growth to be maintained into at least the first half of 2022 as we continue to recover from the pandemic and return to a new normal.”

Jeremy Leaf, north London estate agent and a former RICS residential chairman, said: “Although reflecting some historical buying and selling, the housing market continues to demonstrate remarkable resilience bearing in mind the number of transactions brought forward in the last few months to take advantage of the stamp duty holiday.

“Nevertheless, we are finding activity has lost some oomph but there is still plenty of life left, supported by record low interest rates and supply, while though rising, is not doing so fast enough.

“The market also seems to be shrugging off rising inflation and the end of furlough, as well as widening economic concerns.”

August saw the average cost of a property reach £262,954, up 0.7% on July and the then highest figure on record.

By Jake Carter

Source: Mortgage Introducer

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UK house prices keep rising even as tax break unwinds: RICS

A lack of new homes for sale in Britain boosted prices again last month even as the housing market slowed following a partial withdrawal of a pandemic emergency tax break for property purchases, a survey showed on Thursday.

The Royal Institution of Chartered Surveyors’ (RICS) gauge of new buyer enquiries slipped in August to its lowest level since January, as did its measure of agreed sales.

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But with demand still far in excess of supply – driven by people seeking bigger homes as they work remotely more often after the coronavirus pandemic – the vast majority of surveyors polled by RICS – a net 73% – reported rising house prices, albeit down from a reading of +79% in July.

Other surveys have also pointed to continued house price growth since July when a year-long exemption from the stamp duty tax on house purchases was halved in scale in England and Northern Ireland and expired altogether in Wales. Scotland ended the incentive in April.

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“While momentum has eased relative to an exceptionally strong stretch earlier in the year, there are still many factors likely to drive a solid market going forward,” said RICS economist Tarrant Parsons.

“Given the real shortfall in new listings becoming available of late, there remains strong competition amongst buyers and this is maintaining a significant degree of upward pressure on house prices.”

A significant majority of surveyors – a net 66% – said they expected house prices to rise over the next 12 months, unchanged from July’s reading.

Source: EuroNews

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UK house price rises accelerate in August

The housing market in England and Northern Ireland continued to grow in August, with average house prices rising by almost £5,000 as the government’s stamp duty exemption in England and Northern Ireland came to an end.

The value of the average property climbed to £248,857 – a rise of £4,628 and a monthly increase of just over 2%. This is the second highest increase in 15 years, according to Nationwide.

Experts had forecasted a slowdown in the inflation of property prices as a result of stamp duty tax breaks being eased in July. However, August saw year-on-year house price inflation rise by 11% – a 0.5% increase from the month before.

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Nationwide’s chief economist, Robert Gardner, said: “The bounceback in August is surprising because it seemed more likely that the tapering of stamp duty relief in England at the end of June would take some of the heat out of the market.”

Nationwide said that it expected property prices to continue rising in the short-term, but that activity will “almost inevitably” begin to ease when the stamp duty tax breaks end later this month.

“But even this is far from assured,” said Gardner. “The labour market has remained remarkably resilient to date and, even if it does weaken, there is scope for shifts in housing preferences as a result of the pandemic to continue to support activity for some time yet.”

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Knight Frank’s head of UK residential research, Tom Bill, said: “The housing market has clearly lost none of its core strength, and rising business confidence and rock-bottom interest rates signal a strong end to the year, even as the stamp duty holiday winds down completely.”

Lucy Pendleton, of estate agent James Pendleton, said: “This is a timely lesson that it’s the fundamentals of the market that are all-powerful still. Sunak’s generous state handout has turned out to be more a demonstration of misdirection than crisis management.

“The market didn’t need his money and, with hundreds of billions tucked away in accidental savings, Britons are continuing to satisfy a deep-seated determination to move after a traumatic 18 months.”

Source: Money Expert

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Suburbs see record 11% house price rise during pandemic

House prices in the UK suburbs have grown at record rates, according to new research, with city dwellers helping to drive the spike as they hunt for more space.

An analysis of mortgage transactions included in the Halifax House Price Index between March 2020 and June 2021 revealed that house prices in major British cities (excluding London) grew by an average of 8.9 per cent.

However, in the areas surrounding those cities, average house price growth was much higher at 10.8 per cent, turning the traditional trends on their head.

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Drilling into details, researchers found that the picture varied significantly in individual cities across the country.

In Plymouth, on England’s South West coast, the city itself saw house price growth of 5.8 per cent between March 2020 and June 2021, while in the surrounding areas, the average was 16.1 per cent.

This was driven by the likes of South Hams – home to Salcombe, Britain’s most expensive seaside town – which at 26.3 per cent has seen exceptional house price increases during the pandemic.

Meanwhile in Leicester, house prices in the city grew by 6.5 per cent over the same period, compared to a rise of 12.1 per cent on average in the surrounding area, with Rutland and Melton up by 22.5 per cent.

However, further north it was a different story. In Newcastle, property price increases in the city itself (+6.5 per cent) continued to outstrip those in the surrounding areas (+4 per cent).

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North Tyneside was one of the few areas surrounding major British cities to record a fall in average house prices during the pandemic (-5.0 per cent).

Commenting on the findings Andrew Asaam, mortgages director at Halifax, said: ‘The pandemic has had a huge impact on the housing market right across the country.

‘This has been shaped by buyers’ demand for more space, a desire to move from the centre to more suburban locations, and the trend for more home working both now and in the future.

‘It’s clear from speaking to our mortgage customers that many have prioritised space over location as a result of more time spent at home over the last year and a half.

‘As consumers look for value in the market, that inevitably leads people to look further afield from major city centres, where you tend to get more property for your money.’

Analysts said another contributor to the trend was the stamp duty holiday, as people looked to buy larger, family-sized homes with the tax threshold raised to £500,000.

Overall, the Office for National Statistics recently revealed that the average house price across the UK had increased by 13.2 per cent between June 2020 and June 2021, from £234,668 to £265,668.

By SADIE WHITELOCKS

Source: This is Money

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House prices continue to grow amidst some signs of slowing

Average house prices continued to increase on a monthly basis in July but price pressures may be waning, according to the latest e.surv Acadata House Price Index for England & Wales.

HMRC estimates transactions in June reached 200,000 in England and Wales leading house prices to surge by 9.1% in July to an average of £336,003.

The North-West has the highest annual growth rate at 15.8% but London still lags behind.

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Richard Sexton, director at e.surv, said: “Overall, we saw a continued positive movement in house prices with the average price of completed sales growing by 9.1% in July to £336,003.

“Continuing government support for the housing market and low-interest rates continue to help with buyer affordability and offset the initial stage withdrawal of the stamp duty holiday and the complete withdrawal of the Land Transaction tax in Wales.

“If we exclude the smaller rates of growth in Greater London and the South East, the annual rate of growth remains over a remarkable 12%.

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“In terms of transactions we can see what a difference twelve months can make. In the first quarter of this year, we saw a 32% increase in transactions over the same period last year.

“The stamp duty holiday and the desire for more space when working from home clearly spurred many purchasers into action. What is more unexpected is that the area with the highest increase in sales this year is the South East which belies the belief buyers were rushing to the countryside – in fact buyers have been rushing to secure detached houses but not in rural locations.

“The highest increase of detached property sales in the South East was in fact in Brighton and Hove which saw a rise of 140%. Proof if any were needed that urban living retains its allure for many moving out of bigger cities.”

Source: Mortgage Introducer

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UK house prices now 30% higher than pre-2008 crisis peak

UK house prices hit a new high in June and are 30% higher than the peak they reached before the 2008 financial crisis, according to the latest snapshot of the market.

The property website Zoopla said the average price of a home was £230,700 – as much as 5.4% higher than the same month a year ago.

It said the sharp increase had come as the number of homes being put on the market for sale had dropped by 25% in the first half of the year compared with the same period in 2020.

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Zoopla also said the demand for houses was more than double that in the years before the pandemic, and that family homes were particularly popular. Supply has failed to keep pace with demand since January 2021, with no sign of an imminent rebalance.

The findings echoed a study published on Monday by a rival property firm, NAEA Propertymark, which said that 40% of UK properties sold in June went for more than the original asking price, as fewer buyers fought for limited available stock.

It noted the 40% figure was the highest on record, although it also said the average number of sales agreed per estate agent branch fell very slightly in June, down from 12 to 11 in May. Last week Rightmove said frenzied buyer activity was driving the market ever higher.

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Propertymark’s chief policy adviser, Mark Hayward, said there were typically 19 buyers per available property.

“We are very firmly still in a strong sellers’ market; properties are being snapped up swiftly and at record high UK house prices. We do anticipate a rebalancing of the market over the coming months as the stamp duty holiday continues to be phased out and people return to normality,” he said.

According to the latest snapshot from Zoopla, Northern Ireland and Wales registered the highest growth of 8.6% and 8.4% respectively over the last year. This represented the highest growth for 16 years in Wales.

The market remained polarised in London, with demand in the capital’s suburban areas 86% higher than the 2017-19 average, while interest in inner London was just 2% higher.

Zoopla said it expected price growth to edge upwards to 6% in the coming months, before easing back to 4-5% towards the end of the year as the impact of extended stamp duty unwinds.

By Miles Brignall

Source: The Guardian

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UK house prices up by £100,000 in a single year

Research from the national estate agent, Keller Williams UK, has revealed where across the UK homeowners have seen the biggest cash boost in house prices in just a single year.

The analysis of Land Registry data by Keller Williams UK found that the average UK homeowner has seen a cash boost of £23,116 in just 12 months, with the average UK house price climbing from £231,508 in May of last year, to £254,624 in May 2021 (latest available data).

Biggest Cash Increases By Region

Regionally, the South East has seen the biggest increase with the average home now worth £29,199 more than a year ago.

The latest UK House Price index shows that the North West has seen the largest rate of annual growth of all regions at 15.2%. No surprise then, that the region has also seen the second-largest cash increase in the last year at £24,987.

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In contrast, London has seen the lowest rate of annual growth of all regions at 5.2%, but the higher price of property in the capital means that London homeowners have enjoyed the third-highest cash increase at £24,987.

Biggest Cash Increases By Local Authority

The capital is also home to the area that has enjoyed by far the highest cash increase at local authority level. Homeowners in Hammersmith and Fulham have seen the value of their home increase by a huge £101,496 in the last year alone. However, just one other area of London makes the top 10 biggest cash increase, with homeowners in Bromley enjoying a £59,885 jump in the value of their home.

Outside of London, the average house price in Rutland has climbed by £88,625 in a year, with Oxford (£63,009), West Devon (£61,513) and Cotswolds (£60,825) also seeing values climb by more than £60,000.

Other areas to make the top 10 include Elmbridge (£57,168), Mole Valley (£54,824), Derbyshire Dales (£52,181) and Three Rivers (£47,607).

UK House Prices Have Climbed By 10%

CEO of Keller Williams UK, Ben Taylor, commented:

“The latest market data shows that house prices have climbed by 10% across the UK which is a phenomenal rate of growth. While not all areas have performed as strongly in percentage terms, the differing price of property across the UK market means that the actual cash increase has been sizable, even in the worst-performing regions.

On average, UK homeowners are over £23,000 better off than they were year ago and this is proof, if ever it were needed, that there’s no better investment than bricks and mortar.”

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Table shows the annual cash increase in house prices across each nation and region

LocationAveHP – May 2020AveHP – May 2021Change £
South East£320,817£350,016£29,199
North West£164,258£189,245£24,987
London£473,225£497,948£24,723
Wales£162,701£184,297£21,596
East Midlands£194,596£216,077£21,481
South West£256,208£277,603£21,395
East of England£290,117£310,200£20,084
West Midlands Region£200,156£219,793£19,638
Scotland£152,914£171,448£18,534
Yorkshire and The Humber£164,970£181,856£16,885
North East£127,999£143,129£15,130
Northern Ireland£140,841£149,178£8,337
England£247,499£271,434£23,934
United Kingdom£231,508£254,624£23,116
Source: Gov.uk – UK House Price Index (May 2020 to May 2021 – latest available data)

Table shows the areas to have seen the largest annual cash increase in house prices

LocationAveHP – May 2020AveHP – May 2021Change £
Hammersmith and Fulham£679,448£780,944£101,496
Rutland£297,059£385,684£88,625
Oxford£392,528£455,537£63,009
West Devon£244,690£306,203£61,513
Cotswold£382,197£443,022£60,825
Bromley£426,062£485,947£59,885
Elmbridge£589,090£646,258£57,168
Mole Valley£480,145£534,969£54,824
Derbyshire Dales£258,630£310,811£52,181
Three Rivers£499,256£546,864£47,607
Source: Gov.uk – UK House Price Index (May 2020 to May 2021 – latest available data)

Source: Value Walk

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UK housing hitting record price peaks on pandemic demand

UK housing market – Property prices in the UK are hitting record peaks this summer as Britons seek more space as the pandemic lingers, courtesy of demand stimulated also by temporary tax cuts.

The average sale price rose by 5.4 percent to a record $320,000 in June from a year earlier, lifted also by a supply shortage of listings according to website Zoopla. That was almost a third higher than the previous market peak in 2007, before the onset of the global financial crisis, it added.

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Prices won solid support as swathes of the nation switched to teleworking during the Covid-19 outbreak, ramping up demand for larger homes.

Zoopla cautioned however that demand growth is currently flagging for smaller apartments.

“Demand for houses is still outstripping demand for flats,” said Grainne Gilmore, head of research at Zoopla.

Gilmore noted that the jump in prices was also in part a result of temporary cuts to stamp duty, or taxes on home sales.

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“But underneath this, there is a continued drum-beat of demand for more space among buyers, both inside and outside, funnelling demand towards houses, resulting in stronger price growth for these properties,” she added.

To boost Britain’s virus-ravaged economy, Prime Minister Boris Johnson’s government introduced a raft of costly stimulus measures earlier this year.

Those measures included temporary reductions in the levels of stamp duty. That programme is set to be wound down at the end of September.

Source: Khmer Times

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UK house prices fell slightly in July, says Nationwide

House prices in the UK experienced a 0.5% fall in the month to July, following the record highs seen in June.

The Nationwide House Price Index for July shows annual growth was still significant at 10.5%, but down from the 17-year high of 13.4% a month earlier.

The average UK house price now stands at £244,229, compared to £245,432 in June.

Nationwide chief economist Robert Gardner says the modest fallback in July was “unsurprising given the significant gains recorded in recent months”, adding that house prices increased by an average of 1.6% a month over the April to June period – more than six times the average monthly gain recorded in the five years before the pandemic.

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Gardner says higher priced properties have been driving the increase in housing market activity, with Land Registry data indicating that the number of transactions involving properties bought for £500,000 or higher increased by 37% over the 12 months to March 2021, compared to a rise of 2% for all properties.

“As a result, between Q1 2020 and Q1 2021 the share of transactions involving a property valued at £500,000 or above has increased from 12% to 18%,” says Gardner.

While stamp duty was a significant contributor to UK house prices, the Nationwide data finds the main driver of transactions was from those who would have moved regardless of whether the tax holiday had been in place.

“Amongst homeowners surveyed at the end of April that were either moving home or considering a move, three quarters said this would have been the case even if the stamp duty holiday had not been extended beyond the original March 2021 deadline,” says Gardner.

“Shifting housing preferences appear to have been the more important factor in driving the increase in housing market activity, with people reassessing their housing needs in the wake of the pandemic.”

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Together director of sales Sundeep Patel says: “Despite house price growth slightly cooling off, we’re still seeing double digits. Indeed, while the stamp duty holiday and cheap mortgage deals boosted prices, the growing shortage of available stock, and the fact that property continues to be sold for more than the asking price, threatens the opportunity for those not already on the ladder to find something affordable this year. There is a concern that first-time buyers may struggle to even get a look in, as deposit-rich buyers such as landlords and home movers snap up properties.

“There’s an increasingly a race for space as well, as we see potential buyers are also showing more of an interest in houses over flats and apartments – largely triggered by the desire to have more living space and a garden as we settle into hybrid working, and come to realise the fact that many of us will be spending significantly more time at home for the foreseeable”.

By Bek Commane

Source: Mortgage Finance Gazette

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