Although increases have begun to slow, house prices in the U.K. set another record in May, according to a report Wednesday from Halifax.
The average cost of a home saw an annual rise of 10.5% last month to £289,099 (US$362,539),
the slowest rate of growth seen since the beginning of the year, according to the U.K. bank and mortgage provider. Price growth slowed to 1% compared to the previous month, marking the 11th consecutive monthly rise. “Despite the very real cost of living pressures some people are experiencing, the imbalance between supply and demand for properties remains the primary reason driving the continued climb in house prices,” Russell Galley, managing director at Halifax, said in the report.
Northern Ireland saw the most robust price growth in May, with the cost of a house increasing 15.2% to an average of £185,386, the figures show. England’s South West region registered a 14.5% boost in prices, with an average home costing £305,173. Wales followed, with a 13.7% jump, bringing the average price to £216,120.
Scotland and London were the only U.K. regions to see single-figure price growth. The average price of a residence in the capital was £541,942, while, in Scotland, annual price growth reached 8.3% and a home there now costs an average of £198,288.
With inflation and borrowing costs rising—buyers need around £10,000 more to buy a flat and an additional £50,000 for a detached home than they did in May 2021—Halifax predicted the market is shifting away from the sellers’ advantage.
“The housing market has begun to show signs of cooling,” Mr. Galley said. “Mortgage activity has started to come down and, coupled with the inflationary pressures currently exerted on household budgets, it’s likely activity will start to slow. There is perhaps one green shoot for prospective purchasers: with overall buying demand down compared to last year, we may be past the peak sellers’ market.”
Article Source: Mansion Global