House prices in June, July and August were a tiny 0.1 per cent higher than in the previous three months according to new figures from the Halifax - but they were 2.6 per cent higher than a year ago.
“The annual rate of growth increased from 2.1 per cent in July to 2.6 per cent in August with the average house price now £222,293, which is just above the previous high of December 2016 - £222,190” according to Russell Galley, managing director of Halifax Community Bank.
“Recent figures for mortgage approvals suggest some buoyancy may be returning, possibly on the back of strong recent employment growth, with the unemployment rate falling to a 42 year low. However, wage growth is still lagging increases in consumer prices, which is likely to add pressure on household finances and increase affordability challenges for some buyers” he adds.
The Halifax repeats its earlier belief that prices will remain high thanks to low mortgage rates and a continuing shortage of properties for sale over the coming months.
In response to the figures, Jeremy Leaf - north London estate agent and former RICS residential faculty chief - says: “Fewer transactions are taking place where affordability has been most stretched due to lack of new and existing stock, such as in London - and inflation higher than wage growth. The short-term impact of Brexit on the housing market was probably overestimated but the longer term effects may have been underestimated. However, now that the government is negotiating the UK’s exit from the EU, further uncertainty seems inevitable until the final outcome becomes clearer.”