House prices finish year at 'astounding' record high

A roller-coaster year saw values slump in the summer after lockdown but shoot up as people emerged wanting to change their familiar surroundings – and make use of the stamp duty holiday. Prices were six percent higher in December than in the same month a year earlier, according to Halifax. 

But a month-on-month price increase of 0.2 percent was significantly down on a one percent increase in November.

Russell Galley, Halifax managing director, said: “Average house prices rose again in December, stretching the current run of continuous gains to six months.

“However, the monthly rise of 0.2 percent was the lowest seen during this period and significantly down on the increase in November.

“The average house price was therefore little changed, but nonetheless still reached a fresh record of £253,374.”

Russell said 2020 was a “tale of two distinct halves for the housing market”, with prices down by the middle of the year after a strong start amid Covid restrictions.

He added: “When the market reopened, prices soared as a result of pent-up demand, a desire among buyers for greater space and the time-limited incentive of the stamp duty holiday.

“All this left average prices sitting some six percent higher at the end of 2020 when compared to December 2019, a notably strong performance given the anticipated impact of the pandemic earlier in the year.

“In the near-term, and with ­mortgage approvals still at a 13-year high, there may be enough residual strength in the market to ­sustain prices up to the deadline for the stamp duty holiday and the scaling back of Help To Buy at the end of March.

“However, with the pace of the UK’s economic recovery expected to be constrained by the renewed national lockdown and unemployment widely predicted to rise in the coming months, downward pressure on house prices remains likely as we move through 2021.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said of 2020’s performance: “Given we had two months last year when the property market was forced to close, it really is astounding.

“The availability of very cheap mortgage finance has helped fuel the surge. Covid has given people the ­opportunity to focus on their housing requirements and what is important to them and their families.”

source: express.co.uk

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