Stamp duty hol­i­day pro­pels house prices to record high as buy­ers defy virus fears

The Daily Telegraph - Business - - Front Page - By Melissa Law­ford

PROP­ERTY prices soared 5.2pc in the year to Au­gust, hit­ting a new record high as the mar­ket shrugged off fears over Covid, ac­cord­ing to Hal­i­fax data.

The jump takes the av­er­age sell­ing price to £245,747 and is the strong­est rate of growth since late 2016. A typ­i­cal home now costs £12,206 more than it did a year ago.

How­ever, with earn­ings un­der pres­sure and re­dun­dan­cies mount­ing, the house price index re­port warned it was highly un­likely cur­rent lev­els of price growth would con­tinue. Rus­sell Gal­ley,

Hal­i­fax man­ag­ing di­rec­tor, said that the buy­ing frenzy had been stoked by pent-up de­mand from when the mar­ket was shut, a post-lock­down scram­ble for larger homes and the Chan­cel­lor’s tem­po­rary stamp duty cut. Surg­ing prices have con­founded early pre­dic­tions of a crash in the wake of the eco­nomic havoc wreaked by Covid-19.

Hal­i­fax’s par­ent firm Lloyds warned in July of a worst-case 10pc slump this year.

How­ever, most ex­perts be­lieve the rise is short term and are braced for tur­bu­lence in the months ahead when the stamp duty hol­i­day ends and the tax­payer-funded fur­lough pro­gramme stops. A surge in job losses could yet send prices tum­bling again.

Mr Gal­ley said: “It re­mains highly un­likely that this level of price in­fla­tion will be sus­tained.”

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