Latest data released by Halifax - 6 August 2021
- Prior -0.5%; revised to -0.6%
- House prices +7.6% y/y
- Prior +8.8%; revised to +8.7%
Slight delay in the release by the source. Despite the expiry of the stamp duty holiday, UK house prices are seen rising still in July with the average price of dwellings climbing to £261,221, recovering slightly after the June drop.
In the months ahead, there should be some moderation as the housing market loses some steam but house price growth (on an annual basis) is likely to keep elevated.
Halifax notes that:
"Recent months have been characterised by historically high volumes of buyer activity, with June the busiest month for mortgage completions since 2008. This has been fueled both by the 'race for space' and the time-limited stamp duty break. With the latter now entering its final stages (the zero percent rate only applies to the first £250,000 of the purchase price, before reverting back to standard rates from October), buyer activity should continue to ease over the coming months, and a steadier period for the market may lie ahead.
"Latest industry figures show instructions for sale are falling and estate agents are experiencing a drop in their available stock. This general lack of supply should help to support prices in the near-term, as will the exceptionally low cost of borrowing and continued strong customer demand.
"Although there remains some uncertainty over the impact on employment from the unwinding of government support schemes, on balance the risks to the macro-environment are receding, with consumer confidence improving, the labour market recovering, and the economy expanding as restrictions are lifted. Overall, assuming a continuation of recent economic trends, we expect the housing market to remain solid over the next few months, with annual price growth continuing to slow but remaining well into positive territory by the end of the year."
