House prices exceed record high with 8.2% jump in a year
House prices in the UK rose 8.2% year-on-year to £258,204 in April, the Halifax house price index showed, surpassing the record high of £254,606 recorded in March.
Compared to last month, house prices were 1.4% higher. The previous month-on-month, between February and March, was 1.1% suggesting the stamp duty extension had fuelled growth.
On a quarterly basis, house prices grew by 0.9%.
More highs to come
Nicky Stevenson, managing director at Fine and Country, said low interest rates, loosening Covid restrictions and homeowners saving money would encourage more activity.
She added: “Incredibly, the stage is set for this rally to continue and the market may be about to get its own vaccine bounce, like the one delivered to Boris Johnson this week.
“This won’t be the last record high we’ll see this year by a long stretch, and the figures next month will start to compare more impressively with the lull in growth caused by the first lockdown.”
Slowdown expected at year-end
Russell Galley, managing director at Halifax, said: “The influence of the stamp duty holiday will fade gradually over the coming months as it’s tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market.
“However, we do expect recent levels of activity to be sustained over the short-term as buyers continue to search for homes with more space and potentially better suited for their new working patterns.”
He added: “There is growing optimism in the long-term outlook of the UK economy as the vaccination programme continues at pace, yet we remain cautious about the medium-term prospects of the housing market.
“As we said in March, the current levels of uncertainty and potential for higher unemployment as furlough support ends leads us to believe that house price growth will slow to the end of the year.”
James Forrester, managing director of Barrows and Forrester, said: “The UK property market is currently set to warp speed, make no mistake about it. We’re not just seeing a market recovering from last year’s pandemic paralysis, these current rates of house price growth are exceptional against any backdrop.
“With the fuel tank full to the brim, it’s likely that any natural correction to this explosive rate of growth will come many, many months after the stamp duty holiday deadline and the likelihood is, this current rate of growth will remain throughout 2021.”