Average property values rose by 5.2 per cent over the past year, according to the latest May Halifax Property Price Index – a dramatic jump in property values by recent standards.
The increase represents the biggest annual rise since the start of 2017, and brings average property values to £237,837
However, the lender stated that the overall message was one of ‘stability’ and that May’s sharp rise in prices was against a backdrop of ‘particularly low’ growth in the same period last year.
On a monthly basis, property values rose by 0.5 per cent, down from a 1.2 per cent rise the previous month, while in the quarter to the end of May prices were 2.5 per cent higher, compared to 4.2 per cent growth in the previous quarter.
Britain’s housing market has slowed since 2016’s Brexit referendum, driven by price falls in London and neighbouring areas, exacerbated by higher purchase taxes on homes costing over 1 million pounds and on second homes and small landlords.
The figures stated by Halifax are in contrast to the latest data released by Nationwide, which reported a much lower annual growth rate in property values of just 0.9 per cent, and a monthly growth rate of 0.6 per cent.
Managing director at Halifax, Russell Galley, said: ‘We saw a slight increase in house prices between April and May, but the overall message is one of stability.
‘Despite the ongoing political and economic uncertainty, underlying conditions in the broader economy continue to underpin the housing market, particularly the twin factors of high employment and low interest rates.’
Mr Galley said that this was supported by industry-wide figures, which suggest ‘no real change’ in the number of homes sold each month, while Bank of England data show the number of mortgages being approved rose by almost 6 per cent in April, reversing the softness seen in the previous month.
He concluded: ‘We expect the current trend of stability to persist over the coming months, though clearly any downturn in the wider economy would be keenly felt in the housing market.’
Source: Residential Landlord