UK house prices rise 15.5% in biggest jump in 19 years

Average UK house prices jumped 15.5% year-on-year in July, the biggest rise in 19 years, official figures show.

According to the latest data from the Office for National Statistics (ONS), the average UK house price will be £292,000 ($338,000) in July 2022, £39,000 higher than at this time last year.

This percentage increase was almost double the rate recorded in June, when typical property prices rose 7.8% year-on-year. This is the highest annual inflation rate seen in the UK since May 2003.

The ONS said the increase in annual inflation was largely the result of a ‘base effect’ from lower prices seen at this time last year as a result of changes in stamp duty holidays.

A similar property tax holiday in Wales ended on 30 June 2021 and the equivalent holiday in Scotland ended on 31 March 2021.

The temporary ‘tax-free’ rate based on stamp duty holidays in England and Northern Ireland has been reduced since last July, before the holidays are completely abolished from October 2021. and last July.

By contrast, house prices have risen by £6,000 in the same month this year.

“Real challenge”

Sarah Coles, senior personal finance analyst at Hargreaves Lansdowne, said the latest rise in home prices “was the result of changes to the stamp tax holiday last summer” and “faces a real challenge.” It will not affect the outlook for the market in which we operate.”

Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said her firm expects house prices to fall fully in the second half of the year “given the size of the rise in mortgage rates”.

But other experts are more optimistic.

Knight Frank’s head of UK housing research, Tom Bill, conceded that rising mortgage rates “will ultimately cap the double-digit price gains we’ve seen over the past two years”. His company said it did not expect prices to fall.

Simon McCulloch, chief commercial and growth officer at haulage platform Smoove, said: Prolonged recession. ”

Mike Scott, chief analyst at real estate firm Yopa, said the firm expects house prices to continue rising for the remainder of 2022.

PA Media contributed to this report.

Alexander Chan