House prices rise 0.5% in May
House prices rose by 0.5 per during the month of May to £237,837 and by 5.2 per cent year-on-year, according to the lender’s latest house price index.
Over the three months from March to May, house prices were 2.5 per cent higher than in the preceding three months.
Despite the ongoing political and economic uncertainty, underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low interest rates. This is the view of Russell Galley, managing director at Halifax.
He added: “This is supported by industry-wide figures which suggest no real change in the number of homes being sold month to month, while Bank of England data shows the number of mortgages being approved rose by almost 6 per cent in April, reversing the softness seen in the previous month.
“While current conditions may help those looking to make their first move onto the property ladder, existing homeowners will doubtless be considering long-term house price growth which continues to look subdued in comparison to recent years.
“Looking ahead, we expect the current trend of stability based on high employment and low interest rates to persist over the coming months, though clearly any downturn in the wider economy would be keenly felt in the housing market.”
Tomer Aboody, director of property lender MT Finance, believes the housing market is continuing to show signs of recovery and confidence.
He added: “Buyers have come to the conclusion that enough is enough, and the uncertain conditions which have been facing them could carry on for a while still, so that shouldn’t hold them back from getting on the ladder or moving up or down it.
“Fewer homes are on the market since sellers feel that they either don’t have to sell when values are still down on 2016 or with the stamp duty levels being so high they can’t afford the step up so are staying put for now. We don’t see this changing anytime soon.”