08 Jul 2022
UK property prices in Britain jumped 13% in the year to June, taking the average house price to £294,845, says a leading British lender. It is the highest annual growth rate since 2004, according to the latest Halifax house price index. Prices went up by 1.8% in June alone, up from 1% in May, which is the 12th consecutive month of price inflation. Russell Galley, managing director at Halifax, said: “The supply-demand imbalance continues to be the reason house prices are rising so sharply. Demand is still strong – though activity levels have slowed to be in line with pre-Covid averages – while the stock of available properties for sale remains extremely low.” He added: “Of course, the housing market will not remain immune from the challenging economic environment. But for now it continues to demonstrate – as it has done over the last couple of years – the unique combination of factors impacting prices. One of these remains the huge shift in demand towards bigger properties, with average prices for detached houses rising by almost twice the rate of flats over the past year (13.9% vs 7.6%).” He went on to say that moving forward, inflationary squeezes and higher interest rates will drag on the property sector and we can anticipate a slowdown of house price growth in the months ahead. On Wednesday, two senior Bank of England officials said that the UK’s central bank will “do whatever is necessary” to help stop the soaring cost of living from becoming a permanent inflation issue, suggesting more and possibly larger, rate hikes. The Bank has raised interest rates five times since December to 1.25%.
Northern Ireland is the region which continues to have the strongest annual growth in house prices, up by 15.2% to an average property price of £187,833, according to the report. Wales is close behind with 14.3% annual growth to an average price of £219,281. The British capital is lagging behind other regions with annual price gains of 7.1%, though with an average property price of £547,031 it is still the most expensive place in the country to purchase by a considerable margin.