House price boom in “full swing” says AJ Bell analyst
House prices in April were 1.4% higher than in March on a monthly basis.
Over the last quarter, from February to April, house prices were 0.9% higher than in the three months before, from November to January, according to the house price index.
During April, house prices were up by 8.2% compared to the same month in 2020.
UK house prices grew in April at the quickest rate in over 15 years, research by Nationwide revealed.
House prices in April surpassed the record high from the previous month as the housing market continued its recent momentum.
Laith Khalaf, financial analyst at AJ Bell, commented on the figures:
“The house price boom is still in full swing, as white line fever is pushing buyers into the market to take advantage of the recently extended stamp duty holiday. Mortgage approvals have fallen back in recent months, which hints that some froth may be coming off the very top of the market. But we’re approaching the busy summer season, and there are plenty of tailwinds that will help to keep prices elevated moving forwards.
Khalaf also noted the variety of support offered by the government in addition to the pent-up savings as people remained at home during the pandemic.
“The stamp duty holiday is gradually being tapered away by the end of September, but borrowing costs are still low, and the government continues to offer support in the form of Help to Buy and the Mortgage Guarantee Scheme. We also know that plenty of consumers have built up a war chest over the pandemic which can help them trade up the property market, perhaps to get some extra space for a home office.”
Russell Galley, Managing Director, Halifax, said:
“The average property is now worth £258,204, up 1.4% month on month and 8.2% annually, the highest annual growth rate in 5 years. In cash terms, almost £20,000 has been added to the value of the average home since the market had essentially come to a standstill in April 2020.”
“The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the Government scheme. The influence of the stamp duty holiday will fade gradually over the coming months as it’s tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market.”
