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Home prices rose 4.3% in August from a year earlier, marking the highest annual growth rate since November 2022.
Monthly prices rose 0.3% in August, following a 0.9% increase in the previous month.
Sarah Palmer, distribution director at The Mortgage Lender (TML), said: “Unlike recent house price indices, the Halifax HPI shows that house prices are rising year-on-year as market activity picks up.”
“Those who have been waiting for better terms appear to have finally hit the jackpot, taking full advantage of a succession of mortgage rate cuts from lenders, with the Bank of England reporting that mortgage debt taken out by individuals in July reached £2.8 billion, the highest since November 2022.”
“There may also be increased activity in the housing market ahead of the budget in October as people look to sell properties to avoid the burden of rumoured upcoming tax increases.”
“All of these factors combined have resulted in a stronger-than-anticipated market and higher prices, especially as summer draws to a close.”
Halifax’s index differs from the others in that the Office for National Statistics predicts house prices will fall by 1.4% in 2023, while Nationwide predicts house prices will rise by 2.4% in the year to August 2024.
Jason Tebb, managing director of OnTheMarket, said: “August is traditionally a quiet period for the housing market, but estate agents have been busy with buyers and sellers spurred into action by the long-awaited interest rate cuts from the Bank of England.”
“This increased activity and interest is being reflected in average home prices, creating challenges for buyers.
“Despite lenders lowering mortgage rates, affordability remains an issue, with buyers neither ready nor able to pay exorbitant prices.”
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