UK house prices dipped by £10k between June and July

UK house prices dipped by £10k between June and July

UK house prices plunged by £10k between June and July as the full stamp duty holiday ended

  • In July, the average price was £255,535 according to the House Price Index
  • This was nearly £10,000 lower than a record of £265,448 in June
  • The dip translates to house price growth slowing to 8% from 13.1% 

The average UK house price plunged by around £10,000 between June and July as a full stamp duty holiday ended.

The price was £255,535 in July, according to the Government’s latest House Price Index – around £19,000 higher than a year earlier but nearly £10,000 lower than a record of £265,448 in June.  

This translates to annual house price growth slowing to 8 per cent in July, following a 13.1 per cent increase in June. 

The average UK house price plunged by around £10,000 between June and July as a full stamp duty holiday ended

Annual house price rates of change for all dwellings, UK, January 2006 to July 2021

Mike Scott, chief analyst at estate agency Yopa, says that figures do show a ‘big fall’ but he points out that the June figure was distorted by people rushing to complete their purchase by the end of the month in order to save on their tax bill.

He explains: ‘May’s figure of 9.4 per cent is a better comparison, suggesting that there has only been a small slowdown in the underlying rate of house price growth. 

‘Yopa expects a further boost in September as people rush to beat the final tax-saving deadline in England and Northern Ireland [on 1 October], but we don’t anticipate much of a slowdown after the end of the stamp duty savings. 

‘With demand for homes still high and supply remaining very limited, we expect the underlying rate of annual house price growth to remain around 8 per cent into at least the first quarter of 2022, well ahead of wage increases and consumer price inflation.’

In terms of regions, the House Price Index report, published by the Office of National Statistics, showed that average prices increased over the year in England to £271,000 (7 per cent growth), in Wales to £188,000 (11.6 per cent), in Scotland to a record £177,000 (14.6 per cent) and in Northern Ireland to £153,000 (9 per cent).

The North East was the English region with the highest annual growth, with average prices increasing by 10.8 per cent in the year to July to reach £145,000.

All dwellings annual house price rates of change, by English region, year to July 2021

The lowest growth was in London at 2.2 per cent. The capital’s average price remains the most expensive of any region in the UK at £495,000

The lowest growth was in London at 2.2 per cent. The capital’s average price remains the most expensive of any region in the UK at £495,000.

Anna Clare Harper, CEO of property consultancy SPI Capital, said: ‘The data reflects the comedown from an artificial boom encouraged by the temporary reduction in stamp duty.

‘Investors, homeowners, solicitors and banks pushed hard to get transactions done in time for buyers to capitalise on lower transaction costs. This was followed by a slowdown in pace.’

Gabriella Dickens, senior UK economist at Pantheon Macroeconomics, said the slowdown ‘marks the start of a deceleration that is set to continue over the rest of the year, following the full reversal of the (stamp duty land tax) threshold back to £125,000 at the end of this month and the impending pressure on households’ real incomes from higher CPI (Consumer Prices Index) inflation and the withdrawal of the furlough scheme’.

Separate figures released by the ONS on Wednesday showed CPI inflation jumped from 2 per cent in July to 3.2 per cent in August – the highest since March 2012.

Nitesh Patel, strategic economist at Yorkshire Building Society, said: ‘For many first-time buyers the whole process of realising their dreams of homeownership has become a whole lot more difficult.

‘The price of a typical first-time buyer home has grown by 7.7 per cent year-on-year to £214,237 in July.

‘If they want to put down a deposit of 10 per cent they now need to save £21,423 compared to £19,318 before the start of the pandemic in February 2020.

‘While some will have benefited from keeping their jobs and perhaps boosting their savings, others will have been less fortunate.’






Source: Read Full Article

Previous post Bethenny Frankel talks B Strong's disaster relief efforts in Louisiana, how she navigates around red tape
Next post Michael Caine Starrer Best Sellers to Open Hybrid 2021 Raindance Film Festival- Global Bulletin
Lifestyle