House price growth slowed in June, but the typical house still made £20k in a year

House price growth slowed to 7.8% in June, but the typical house still earned £20,000 in a year, official figures show.

  • ONS figures reveal slowdown in annual growth from 12.8% in May
  • Across the UK, England experienced the slowest rate of house price growth at 7.3%.
  • The slowdown is attributed to the sharp rise in prices in June 2021
  • Buyers were taking advantage of the stamp duty tax exemption at the time.

House price growth slowed sharply to 7.8 percent in the year to June, down from 12.8 percent in May.

Figures from the National Statistics Office reveal the slowdown in growth to single digits, which was driven by the increase in house prices observed in June last year as a result of the tax breaks in force at the time.

The median house price in the UK was £286,000 in June 2022, which is £20,000 more than last year.

House price growth slowed in the year to June, below double-digit growth in the same period to May

On March 3, 2021, the government announced an extension of the stamp duty holiday in England and Northern Ireland until June 30, 2021. The relief enabled homebuyers to save up to £15,000 in tax.

The announcement saw a spike in activity as buyers tried to insure their home purchases to take advantage of the tax break.

After that, the relief threshold was lowered to £250,000 until 30 September 2021, a maximum saving of £2,500.

From 1 October 2021, the stamp duty thresholds reverted to their values ​​prior to 8 July 2020. The tax holiday for Scotland ended on 31 March 2021. The tax holiday for Wales ended on 30 June of 2021.

Tom Bill, head of UK residential research at Knight Frank, said: “Stamp duty holiday distortions mean June house price growth can be largely ignored.

‘The big picture is that prices are waiting for gravity to hit this fall. Rising rates have boosted demand as buyers try to move before mortgage offers expire, but a more expensive credit environment will eventually drive buyers’ budgets down.

“Meanwhile, the supply recovery that began in late spring has been put on hold as more people take summer vacations for the first time in three years. As supply increases and demand weakens, we expect price growth to end the year in single digits.”

The median house price in Scotland increased by 11.6% in the year to June 2022, reaching a record level of £192,000.

Wales also posted a record median house price in June of £213,000, up 8.6% from 14.1% in May.

While England saw the lowest UK house price growth of 7.3 per cent in June, it also saw a new record median house price of £305,000, the ONS said.

Commenting on the figures, Nathan Emerson, chief executive of estate agent membership body Propertymark, said: “As of this month, for the first time since recent price hikes, the data shows that the average is starting to decline. “.

‘Despite this slowdown in the market, agents continue to report increases in the time it takes to trade in, and our latest Housing Market Report shows that 41 percent of sales took 17 weeks or longer to complete. performed, compared to just 10 percent previously. pandemic.

‘With interest rates rising, homebuyers, who initially got a mortgage at lower rates even before they saw available properties, may well start to see them mature before they trade in. This could have knock-on effects on both declines and affordability indices.”

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