Average house price passes £250,000 for first time
House prices in the UK surged 7.5% annually to £250,457 in October, the strongest growth since June 2016, according to the Halifax House Price Index.
It is also the first time that house prices in the UK have exceeded a quarter of a million.
The monthly growth was a little more subdued with a 0.3% change since September, down from the 1.5% last month but still in line with the sustained increases in prices since the housing market reopened.
On a quarterly basis, property prices rose by 4%.
Russell Galley, managing director at Halifax, said: “This level of price inflation is underpinned by unusually high levels of demand, with latest industry figures showing home-buyer mortgage approvals at their highest level since 2007, as transaction levels continue to be supercharged by pent-up demand as a result of the spring/summer lockdown, as well as the chancellor’s waiver on stamp duty for properties up to £500,000.”
Galley added: “While government support measures have undoubtedly helped to delay the expected downturn in the housing market, they will not continue indefinitely and, as we move through autumn and into winter, the macroeconomic landscape in the UK remains highly uncertain.
“Though the renewed lockdown is set to be less restrictive than earlier this year, it bears out that the country’s struggle with Covid-19 is far from over. With a number of clear headwinds facing the housing market, we expect to see greater downward pressure on house prices as we move into 2021.”
Mark Harris, chief executive of SPF Private Clients, said although prices had reached a record high, it was clear growth had “slowed considerably”.
“The housing market bounce back was hard and strong when we were able to go out after the first lockdown eased but it has petered out a little and we are seeing more normalised figures,” he added.
Miles Robinson, head of mortgages at Trussle, said: “It’s likely that the heightened demand from buyers, and a race against the clock to meet the stamp holiday deadline was the driving force behind rising property prices last month.”
However, Robinson added it was possible that the market would see a downturn amid a second wave of coronavirus in the UK.
He said: “We’d encourage the government to consider granting the stamp duty holiday to anyone who has exchanged on a property by 31 March 2021. We believe this is the fairest way to support buyers during these unprecedented times.”