U.K. House Prices Rose at Fastest Pace in Six Months, Halifax Says

(Bloomberg) -- U.K. house prices rose at the strongest pace in six months as buyers eyed a path out of lockdown and the government extended a temporary tax break on purchases, mortgage lender Halifax said.

The 1.1% increase followed no change in February and brought the annual pace of house price inflation to 6.5%. The average cost of a home rose to 254,606 pounds ($349,000).

Britain’s housing market boomed last year, shaking off the worst recession in three centuries and restrictions to control the coronavirus. In March, the Treasury extended a holiday on stamp duty that was due to expire, leaving buyers eager to complete before the deadline.

“The housing market enjoyed something of a resurgence during March,” Russell Galley, managing director of Halifax, said in a statement on Friday. “We expect elevated levels of activity to be maintained. Work-life priorities have shifted during the pandemic. A shortage of homes for sale will also support prices.”

The data contrast with figures from rival lender Nationwide Building Society, which said prices fell in March. Another report by the Royal Institution of Chartered Surveyors earlier this week that said inquiries, prices and new listings all climbed last month, with the outlook for sales the most upbeat since before the pandemic.

“With the economy yet to feel the full effect of its biggest recession in more than 300 years, we remain cautious about the longer-term outlook,” Galley said. “Given current levels of uncertainty and the potential for higher unemployment, we still expect house price growth to slow somewhat by the end of this year.”

©2021 Bloomberg L.P.