House prices hit a new all-time high in July as the property market gradually reopened, after being put on hiatus during the coronavirus lockdown.
According to the latest Halifax House Price Index, the average price of a house was £ 241,604 last month, 1.7% above the £ 237,834 in June.
Prices are 3.8% higher than in July 2019.
Halifax chief executive Russell Galley said pent-up demand and a lack of available homes combined to push prices up.
The government’s temporary reduction in stamp duties also spurred buyers’ enthusiasm, he said.
Last month Chancellor Rishi Sunak announced a temporary suspension of stamp duty on property sales of up to £ 500,000 in England and Northern Ireland.
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The latest figures reflect recent figures from the Nationwide Building Society, which showed house prices rebounded in July, climbing 1.7% during the month.
“The latest data adds to the emerging view that the market is experiencing a surprising spike after the lockdown,” Mr. Galley said.
But he warned that while the outlook for the housing market was brighter than might have been expected three months ago, the effects of the pandemic still create a lot of long-term uncertainty.
“As government support measures end, the resulting impact on the macroeconomic environment, and in turn on the housing market, will begin to become more apparent,” he added.
This view was echoed by Anna Clare Harper, author of Strategic Property Review, who said the Halifax findings reflected current confidence in the economy:
“What we can’t predict is what will happen next: economically and politically.
“What we can accurately predict is that these two factors will prove to be fundamental to the future of the UK property market,” she said.