UK house prices are on the rise, market outlook is uncertain.
UK house prices continue to rise in late 2021.
Median house prices in the UK defied expectations and continued to rise last month despite the phasing out of the government stamp duty in late September.
The continued increases mean that the price of an average house in the UK has risen above £250,000 for the first time in the Nationwide Building Society index.
Other house prices indexes have already posted UK averages above a quarter of a million pounds. Official figures from the Office for National Statistics based on the completion of mortgages put the median price at £264,000 in August, while the Halifax Construction Society suggested the milestone was approved in October 2020.
Nationwide said that house prices rose 0.7% in October this year from the previous month, meaning the median property price has risen by more than £30,000 since the coronavirus pandemic began in March 2020.
Meanwhile, year-on-year home price inflation remained at the high level of 9.9% last month, just shy of the 10% level recorded in September.
The threshold for paying the stamp duty was lowered from £500,000 to £250,000 in July, before the tax exemption ended in September.
“Demand for homes has remained strong despite the expiration of the stamp duty holiday in late September,” said Robert Gardner, chief economist at Nationwide. “Combined with the lack of homes on the market, this helps explain why price growth has remained strong.”
There were expectations that home purchase demand would slow after the threshold for paying stamp duty was lowered from £500,000 to £250,000 in July, and the tax exemption came to an end in September.
However, it is not clear whether house prices will continue to rise in the coming months, and Gardner called the outlook for the housing market “extremely uncertain.”
Higher property price inflation depends on many factors, including interest rates, consumer confidence, and employment levels after the end of government measures to support the pandemic, including the licensing plan.
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