UK house prices post biggest jump in six months

[LONDON] UK house prices jumped at the fastest pace in 6 months in March as the property market continued to defy the cost of living crisis tightening its grip on household budgets.

The average value of a home rose 1.4 per cent to a record £282,753 (S$503,225), mortgage lender Halifax said on Thursday (Apr 7). The 9th straight monthly gain left prices 11 per cent higher than a year ago, close to the fastest annual increase since 2007.

The surge means prices in the UK are now 18 per cent, or £43,577, higher than they were at the time of the first Covid lockdown 2 years ago. While most economists expect prices to moderate as inflation surges and real incomes fall this year, the market is yet to show any signs of that slowdown.

"The story behind such strong house price inflation remains unchanged - limited supply and strong demand, despite the prospect of increasing pressure on households' finances," said Russell Galley, managing director at Halifax. "Although there is some recent evidence of more homes coming onto the market, the fundamental issue remains that too many buyers are chasing too few properties."

In the past year, the £28,113 increase in prices has almost matched the UK's average salary, Halifax said. The south-west region has posted the biggest gains in prices in the period, the first time since January 2021 that Wales has not held the top spot. BLOOMBERG