House price increases recorded a staggering recovery in August as average real estate prices rose by nearly £ 5,000 ($ 6,878) over the course of a month.
Across the UK, average home prices in August were £ 248,857 ($ 342,361), 11 percent higher than the previous year, the National Building Association said.
Average home prices in August were £ 4,628 ($ 6,366) higher than £ 244,229 ($ 335,994) in July.
Property value rose 2.1% month-on-month as a percentage, the second largest increase in the last 15 years.
Previously in April of this year, a monthly increase of 2.3% was recorded.
Home prices are now about 13 percent higher than at the start of the coronavirus pandemic, said Robert Gardner, chief economist across the country.
“The August bounce is amazing,” he said.
He said the tapering of stamp duty holidays in England and Northern Ireland from July seemed likely to have removed some of the heat from the market.
Gardner suggested that this strength may reflect strong demand from homebuyers for real estate prices between £ 125,000 ($ 172,000) and £ 250,000 ($ 343,000).
The range of “zero rate” stamp duty will be halved from £ 500,000 ($ 688,000) to £ 250,000 ($ 343,000) from July and will return to £ 125,000 ($ 172,000) from October.
“Supply shortages are also likely to be a key factor behind the August price hike, and realtors report a small number of properties on their books,” Gardner continued. rice field.
Looking to the future, he said:
“But even this is not guaranteed. The labor market has been very resilient so far, and even if it weakens, housing preferences change as a result of the pandemic and support activities for some time. There is room to continue. “
Mark Harris, CEO of Mortgage Broker SPF Private Clients, said:
“We heard from the Bank of England earlier this week that savings deposits would increase significantly, giving lenders more ammunition in offering bottom prices.
“When we head to the fall, we’re expecting more of the same for now, as lenders are lowering interest rates from loans to value, as well as those with the largest deposits. , There are opportunities for both first-time buyers and movers. “
Gabriella Dickens, Senior UK Economist at Pantheon Macroeconomics, said: It turned around in the next quarter.
“Therefore, we believe house prices will rise again in 2022, ending a year about 4% higher than the end of 2021.”
Martin Beck, Senior Economic Advisor at EY Item Club, said:
“Other factors also affected price increases in August, which may continue for the foreseeable future.
“Consumer confidence remains high and buyers continue to benefit from ultra-low mortgage rates.
“On the other hand, pandemics can have a long-term impact on real estate preferences, including increasing demand for larger homes in the world of more telecommuting.
“There are many props that support the housing market when combined with the fuel for real estate deposits provided by the significant savings accumulated by some households during the blockage.”
“It looks unlikely that home prices will fall sharply,” he added.