26 Sep 2022
Those looking to sell their properties in the UK hiked the prices they are seeking for their homes at the greatest pace in four months, suggesting the market is, currently, shaking off the impact of a cost-of-living crisis and higher borrowing costs. Rightmove said prices climbed 0.7% this month after a 1.3% drop in August. Buyer demand is 20% higher than the pre-pandemic average, and the supply of homes coming to the market has returned to 2019 levels. “The housing market continues to be extremely resilient even in the face of the economic headwinds that are stretching household finances,” said Tim Bannister, the company’s director of property services. “Prices are likely to remain strong while demand continues to outweigh supply.” He went to say that the government’s move to double the threshold for stamp duty to £250,000 means that a third of all properties on the market at the moment are exempt, which will boost demand. “We could see more first time buyers. But because the change is permanent and because of gathering headwinds such as rising mortgage rates, we expect to see a more gradual increase in demand.” The Times first reported the stamp duty news last week, saying it was an effort to stimulate stagnant growth on the UK economy. UK housebuilders’ share values rose as a result. “A stamp duty cut may revive the fortunes of UK homebuilders, who started seeing normalization of activity from frenetic levels of the last two years,” said Iwona Hovenko, a real estate analyst at Bloomberg Intelligence. Stamp duty tax is paid on increasing portions of the property price when one buys a property or land in England and Northern Ireland. Under the current system, no stamp duty is paid on the first £125,000, with the threshold for first-time buyers set at £300,000. The amount to pay depends on whether the land or property is for residential use, non-residential, or mixed-use. The latest Rightmove report also showed London house prices rose 2.1% in the last month, the strongest jump of any of the regions, whereas prices fell in the Midlands and Wales.