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HomeOwners Alliance Reviews House Price Data for the Year
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
HomeOwners Alliance Reviews House Price Data for the Year
As the major house price indices often report conflicting data, the HomeOwners Alliance has reviewed the figures to determine exactly what is happening in the property market.
Its May 2016 House Price Watch shows that house prices have risen by 0.7% in the past month and are up by 7.2% over the last year. These figures were calculated by finding the averages of house price growth data from other indices.
The average monthly change in house prices varies across the major indices, from a low of -0.5% reported by Land Registry to a high of 2.6% from Halifax.
It is believed that property sales surged between February and March, as buy-to-let landlords and second homebuyers rushed to beat the 1st April Stamp Duty deadline. On a monthly basis, there were 41.5% more property transactions, while there was an increase of 69.7% reported over the year.
The Council of Mortgage Lenders (CML) estimates that gross mortgage lending reached £25.7 billion in March, up by 43% on February and 59% on an annual basis. Again, it is believed that this was driven by a rush of landlords hoping to beat the 3% Stamp Duty surcharge.
Looking forward to the rest of the year, fewer transactions are expected. The HomeOwners Alliance reports that the distortion caused by the Stamp Duty change appears to be much larger than any previous tax revision.
The CML expects to see around 10,000 fewer mortgaged transactions each month in the second quarter of the year than would otherwise have been the case.
It is also forecast that house prices will slow in the near term, as uncertainty surrounds the forthcoming EU referendum and regional elections.
The Research Director of the HomeOwners Alliance, Katherine Binns, comments: “The Stamp Duty on second homes from 1st April 2016 has brought a rush of activity to the market ahead of the change. Looking forward, fewer transactions are expected later in the year to offset the early surge in the market. House prices, too, are likely to settle in the near term with the current climate of uncertainty around the European referendum and local elections.”
