UK Property Values Up Year to May

The property market shrugged off any potential referendum turmoil. Recording a 3.3 per cent annual rise in values to May. Values have risen £7,400 on the cost of a typical three bedroom semi at £220,706, said the Halifax. There has been “virtually no change” in house prices over the last three months; while values increased by 0.4 per cent month-on-month in May. The data from Halifax should dismiss concerns that house prices are on a downward spiral. Average prices still are 0.7 per cent below peak levels of December 2016 peak. However, Halifax hasn’t reported a month-to-month decline in prices since January. “Recent further falls in mortgage rates are helping home buyers to take out slightly larger loans, even though their real wages are falling. “The extremely low rate of job losses means that few home owners are being forced to sell their homes; many are deciding to delay listing their homes until the market strengthens again.   House price growth is running at around a third of the levels seen in spring last year and the 3.3 per cent rise is the lowest annual rate since a 2.6 per cent increase in May 2013, the Halifax data showed.

UK Property Values Up Year to May, What is sustaining the momentum?

Martin Ellis of the Halifax, said: “The fact that the supply of new homes and existing properties available for sale remains low, combined with historically low mortgage rates and a high employment rate, is likely to support house price levels over the coming months.” Mr Ellis pointed to recent HM Revenue and Customs figures showing sales fell by three per cent between March and April. He added that Bank of England figures have shown the volume of mortgage approvals for house purchase – indicating completed sales – also down two per cent between March and April. Despite, the political uncertainty, and shrinking house price inflation, the key economic drivers of the housing market remain the same; a severe undersupply of new housebuilding, low interest rates and strong employment. A period of stable Government now we are post-election is a positive for house price growth.