(Alliance News) -Â The UK government's stamp duty holiday extension furthered the housing market's momentum last month, Halifax said on Monday.
House prices surged 8.2% year-on-year in April, picking up sharply from March's 6.5% growth to mark the fastest annual rise in five years. On a monthly basis, prices rallied 1.4% after growth of 1.1% in March, to leave the average UK house price standing at GBP258,204.
The government's stamp duty holiday was originally set to end in March. However, in March, Chancellor Rishi Sunak extended the stamp duty holiday from the end of that month until the end of June, and after this a new GBP250,000 threshold will apply until the end of September.
"House prices in April eclipsed the record high set the month before as the market continued to maintain its recent momentum," said Halifax managing director Russell Galley.
"The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the government scheme," said Galley. "The influence of the stamp duty holiday will fade gradually over the coming months as it's tapered out but low stock levels, low interest rates and continued demand is likely to continue to underpin prices in the market."
The recent boom is expected to stay in the short-term as buyers look for properties with more space using savings built up over lockdown.
"There is growing optimism in the long-term outlook of the UK economy as the vaccination programme continues at pace, yet we remain cautious about the medium-term prospects of the housing market. As we said in March, the current levels of uncertainty and potential for higher unemployment as furlough support ends leads us to believe that house price growth will slow to the end of the year," Galley said.
By Lucy Heming;Â lucyheming@alliancenews.com
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