UK house prices have risen at their fastest rate since 2007, mortgage lender Halifax said on Monday.
House prices rose 0.5% in February in month-on-month terms, bringing the average to £278,123 pounds, up 10.8% year on year.
“Lack of supply continues to underpin rising house prices, with recent industry surveys showing a dearth of new properties being listed, now a long-term trend,” said Halifax managing director Russell Galley.
However, inflation, tax hikes and rising interest rates could dampen price growth later in the year.
“These factors are likely to weigh on buyer demand as the year progresses, with market activity likely to return to more normal levels and an easing of house price growth to be expected,” Galley said.
Britain’s housing market has surged since 2020 on demand for bigger properties as more people worked from home during the Covid pandemic.
“Looking ahead, as Covid moves into an endemic phase and almost all domestic restrictions are removed, geopolitical events expose the UK to new sources of uncertainty,” Galley said
“The war in Ukraine is a human tragedy, but is also likely to have effects on confidence, trade and global supply chains. Surging oil and gas prices are one immediate consequence, meaning that inflation in the UK – already at a 30-year peak – will remain higher for longer.”