UK house prices jumped in July after coronavirus lockdown restrictions eased and the government announced a stamp duty holiday, sparking a “mini-boom” in the property market.
UK house prices in July were 1.6 per cent higher than the previous month.
House prices last month were also 3.8 per cent up compared to July 2019, according to the latest Halifax data.
However on a quarterly basis, house prices in May to July were 0.2 per cent lower than between February and April.
Halifax managing director Russell Galley said the market is experiencing a post-lockdown spike.
“As pent-up demand from the period of lockdown is released into a largely open housing market, a low supply of available homes is helping to exert upwards pressure on house prices,” he said.
“Supported by the government’s initiative of a significant cut in stamp duty, and evidence from households and agents suggesting that confidence is currently growing, the immediate future for the housing market looks brighter than many might have expected three months ago.”
However experts said the housing market activity could slow down as government support measures, such as the coronavirus jobs retention scheme, are withdrawn.
EY Item Club chief economist Howard Archer said: “Many people have already lost their jobs, despite the supportive Government measures, while others will be concerned that they may very well still end up losing their job once the furlough scheme ends.
“Additionally, many incomes have been affected. Consumer confidence is currently still low compared to long-term norms and many people are likely to remain cautious for some time to come when making major spending decisions such as buying or moving house.”
“In particular, a weakening in labour market conditions would lead us to expect greater downward pressure on prices in the medium-term,” Galley added.