House prices have surged for the first time in six months
New research from Halifax has found the cost of homes has increased for the first time since March amid supply shortages.
At the beginning of this month, data from Nationwide found that house prices unexpectedly increased in October by 0.9%, which, was the biggest hike since August 2022.
However, new research from Halifax Mortgages has further added to the severity of this problem. Experts found the average price of a property increased to £281,974 last month, up from 1.1% from September.
Kim Kinnaird, the director of Halifax Mortgages said: ‘Prospective sellers appear to be taking a cautious attitude, leading to a low supply of homes for sale. This is likely to have strengthen prices in the short-term, rather than prices being driven by buyer demand, which remains weak overall.
‘While many people will have seen their income grow through wage rises, higher interest rates and wider affordability pressures continue to be a challenge for buyers.’
On a more positive note, researchers discovered properties in South-east England are continuing to decrease in price as they have been found to be down by 6%. In addition, whilst London has the highest average house price in the UK, it has dropped by 4.6% over the last year – homes in the capital city average at £524,057.
Against this backdrop, last week the Bank of England made the decision to leave interest rates at 5.25% as they claimed their focus will now be on tackling high inflation rates to avoid the UK going into a recession. The previous hikes of interest rates have contributed to a modest dip in mortgage costs as on Tuesday the rate fell to 6.26% from 6.29%, according to Moneyfacts.
Ms Kinnaird said: ‘The current picture should continue to be seen in the context of the longer-term house price trend as, on average, prices remain about £40,000 above pre-pandemic levels.’
According to data from Halifax, the organisation believe house prices will return to growth from 2025.
Image: kalhh
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