House Prices Rise:
The rise in prices to May 2019 shows the fastest pace for two years says the Halifax Building Society.
The year to May increase of 5.2% reflects stability in the economy despite the uncertainty of Brexit says the leading UK mortgage lender.
The continuing high unemployment rate – there are fewer out of work and claiming benefits since the 1970s – and with low interest rates together they underpin the continuing demand for house purchases.
The unemployment rate in the UK fell to 4% in the three months to November 2018, its lowest level since the 1970s. This was slightly below market expectations of 4.1%.
Halifax says the average house price in the UK now stands at £237,837.
However, the lender warns that the May 2019 sharp increase in house prices is against a backdrop of “particularly low house price growth” over the same period last year.
There has been a definite slowing of Britain’s housing market since the 2016 Brexit referendum, driven largely by bigger price falls in London and the surrounding south-east neighbouring areas, and exacerbated by higher stamp duty for home buyers and small-scale landlords on purchases of second homes and buy-to-lets.
The optimistic figures produced by the Halifax though contrast somewhat with the latest figures produced by the Nationwide, which show a lower annual growth rate in property values of just 0.9%.
Russell Galley, Managing director of Halifax, commented:
“We saw a slight increase in house prices between April and May, but the overall message is one of stability.
“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.”