UK house prices climb to record £294,845 as market shows no signs of cooling
Britain's property market defied expectations of a slowdown last month despite rampant inflation and cost of living crisis gripping the nation.
House prices marked the biggest monthly increase since early 2007, up 1.8% month-on-month on average, according to the latest Halifax house price index.
The UK’s largest lender said the annual house price growth rate of 13% during the month is the highest since late 2004.
Across the UK, the average house price in June hit another record high of £294,845 ($352,162).
This means prices have now risen every month over the last year, and are up by 6.8%, or £18,849, in cash terms so far in 2022.
"The growing affordability pressures from rising mortgage rates and runaway inflation have yet to dent demand for homes enough to deter the strong price gains happening across the nation," said Myron Jobson, senior personal finance analyst at interactive investor.
"While the current pace of price appreciation doesn’t appear sustainable over the long run, would be buyers shouldn’t hold their breath for a house market crash."
Northern Ireland topped the table for annual house price inflation, up by 15.2%, with an average property price of £187,833.
Prices in Wales also continued to record a strong rate of annual growth, up by 14.3%, equating to an average property cost of £219,281.
Meanwhile the South West saw the highest annual house price growth of any region in England, at 14.2%, where a typical home now costs £308,128.
Halifax said, London continued to lag behind other regions in terms of annual house price inflation, up 7.1%. But with average prices of £547,031, the capital remains by far the most expensive place in the country to buy a home.
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Russell Galley, managing director at Halifax, said: "The UK housing market defied any expectations of a slowdown.
"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.
"Property prices so far appear to have been largely insulated from the cost of living squeeze. This is partly because, right now, the rise in the cost of living is being felt most by people on lower incomes, who are typically less active in buying and selling houses.
"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."
However, experts anticipate house prices to cool in the coming months as household budget face the tightest squeeze in decades.
"In time though increased pressure on household budgets from inflation and higher interest rates should weigh more heavily on the housing market, given the impact this has on affordability," Galley added.
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