Before the chancellor’s budget speech, I shared the results of the Halifax House Price Index that indicated house prices were on the rise. Since then, there has been talk about an interest rate increase HMRC figures for the six months from April to October 2021 show that an increase in Stamp Duty of around £4.1bn compared to the same period in 2020!
But while conveyancers are busy, the latest reports from estate agencies suggest that we may be in for a tough start to 2022. Nationwide Building Society has said there could be a “cooling” of the UK’s housing market because of rising inflation and interest rates.
Robert Gardner, the chief economist at Nationwide, has commented that the housing market is currently “remarkably robust” despite the end of incentives such as the government’s stamp duty holiday at the end of September.
However, the effects of the economy will have a significant impact, “There are a few things that could moderate [housing demand] a bit in the coming quarters. For example, there are not many homes on the market at the moment. That is likely to hold back activity.”
There are many factors, which can influence the Housing Market, rising inflation squeezing household budgets, and if interest rates rise being a few important ones.
Office for National Statistics (ONS) figures released earlier this week showed the average house price hit a record £270,000 after a £28,000 increase over the past year. Across the UK, prices rose 11.8% over the year to September.
This is not legal advice; it is intended to provide information of general interest about current legal issues.