UK Property Market Continues to Defy Logic
UK house prices are soaring, with the average price of £278,123 marking the fastest rising rate since 2007, according to Halifax.
The industry’s response to the coronavirus pandemic “is continuing to defy economic conditions”, as February’s price hike of £27,200 is “the biggest one-year cash rise recorded in over 39 years of index history” according to a Halifax spokesperson.
This defiant performance is reportedly the result of a shortage of homes for sale, as well as continued relocation from cities to villages or small towns, which itself evens up the distribution of equity across the country. Interestingly, Wales registered the strongest price performance, as prices rose by almost 14% over the past year, while south-west England’s increase of 13.4% put London’s 5.4% into perspective.
The shortage of homes could perhaps be attributed to the Stamp Duty Holiday accelerating sellers to go to market in a move that was never going to last once the incentive was no longer available.
While demand doesn’t seem to currently be affected by increasing interest rates and bills, the war in Ukraine is expected to slow market activity over the course of the year.
As concern grows over the implications of fossil fuels, both from an availability perspective and the climate crisis, it is likely that the value of energy efficient homes will increase significantly, dictated by an increasingly environmentally-conscious market.