Average house prices in the UK were down slightly last month, ahead of the residential market getting a big boost from Rishi Sunak’s Budget this week.
Prices in February stood at £251, 697 in February, which was down 0.1% from January, but still 5.2% higher than a year earlier.
Mortgage lender Halifax added that in the quarter to February, prices were 0.5% higher than in the prior three months.
The market was boosted in the second half of last year, with estate agents and housebuilders reporting pent-up buyer demand following the first lockdown.
A stamp duty holiday was also launched. That was due to finish at the end of this month, and some data had pointed to some slow down as the the buyer rush to meet the deadline seen in late 2020 calmed.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: ’The housing market softened slightly in February as it seemed too late for buyers to take advantage of the stamp duty holiday.”
But earlier this week Chancellor Rishi Sunak said the suspension of stamp duty on property sales of up to £500,000 will be extended to June 30.
A new mortgage guarantee scheme to help buyers with a 5% deposit get on the property ladder was also launched.
Russell Galley, Managing Director, Halifax, said: “The new mortgage guarantee scheme is another welcome development from this week’s Budget. Whilst mortgage approvals have reached record highs in recent months, hitting levels not seen since before the financial crisis of 2008, raising a deposit continues to be the single biggest hurdle for first-time buyers to overcome.”
Galley added: “Though there is the likelihood of an economic ‘bounceback’ from lockdown, with households not unduly impacted by the pandemic deploying the significant reserves of savings that they have built-up, higher unemployment is likely to limit new buyer demand. Therefore, we would not expect the level of growth seen in house prices over the past year to be sustained throughout 2021.”
