U.K. house prices are up this year, sparked by a supply shortage and low mortgage rates, according to the latest house price index Monday from British bank and mortgage lender Halifax.
Property prices in the first three months of the year were 2.7% higher than at the same time a year earlier, the report said, bringing the average property price in the U.K. up to £227,871 (US$322,161).
Prices grew 1.5% in March, the largest monthly gain since last August, according to Halifax.
Mortgages in the U.K. have reached their most affordable level in a decade, the report said, with typical mortgage payments accounting for less than one-third (29%) of homeowners’ disposable income in the fourth quarter of 2017 compared to almost half (48%) in 2007.
The number of new listings is low, too, with stock having fallen for 24 consecutive months, the report said, the worst performance for nine years.
Going forward, Halifax predicts continued growth, albeit modest.
“In the coming months we expect price growth to remain close to our prediction of 3% despite the very positive factors of continuing low mortgage rates, great affordability levels and a robust labor market,” said Russell Galley, Halifax managing director, in the report. “The continuing shortage of properties for sale will also support price growth.”
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