Experts believe the trend will continue.
What happened? As reported by mortgage lender Nationwide, home price growth in the U.K. accelerated last month. The market is holding up despite the end of pandemic emergency support measures for housing and the economy as a whole.
Residential real estate prices rose 0.9 percent in November compared to October, when prices rose 0.7 percent. The year-over-year increase, compared with November 2020, was 10%, higher than the average forecast of 9.3% in a Reuters poll.
Nationwide Chief Economist Robert Gardner said home prices were nearly 15% higher than they were in March 2020, the beginning of the pandemic.
The reasons. Demand for housing in the U.K. has been strong since the first quarantine was lifted last year, helped by interest in more spacious properties as more people began working from home.
The British market was also supported by the tax breaks proposed by Finance Minister Rishi Sunak, which fully expired at the end of September, when the jobs support program also came to an end. Meanwhile, there has been no sign of a surge in unemployment since then.
The shortage of homes for sale also continues to support housing prices.
Quote. “If this continues, housing market conditions could remain quite favorable in the coming months. Especially as the market picks up and there is a possibility that housing supply will continue to shift and support market activity,” Gardner said.
But the specialist said the outlook remains uncertain because of factors such as the possibility of the Bank of England raising interest rates and the impact of the Omicron coronavirus strain on public health and the economy.
“Meanwhile, house price growth has far outpaced income growth, and as a result, real estate affordability is no longer as high as it was before the pandemic,” Gardner added.
