UK house prices increased to a new record high for the fourth straight month in July largely driven by the shortfall of property coming for sale, data from property website Rightmove said on Monday.
House prices increased 5.7 percent on a yearly basis in July, but slower than the 7.5 percent increase logged in June.
Month-on-month, house prices gained 0.7 percent, following a 0.8 percent rise in June. The latest monthly growth was the largest at this time of year since July 2007.
Rightmove said its analysis found a shortfall of 225,000 homes for sale which, if available, would have helped to maintain a more normal level of property stock for sale and would have helped stabilize prices.
Data revealed a marked imbalance between supply and demand for homes with four beds and more, resulting in an average price hike of 6.7 percent in the last six months.
With the ongoing need for housing, high activity levels despite the June stamp duty deadline now passing, and with residential property prices appreciating better than many other asset classes, positive sentiment is expected to continue.
It is likely that the first half of 2021 has seen a record number of moves when compared with the first six months of any other year, induced by the pandemic’s side-effect of a new focus on what one’s home needs to provide, Tim Bannister, Rightmove’s Director of Property Data, said.
Demand has also been boosted by the ongoing creation of new households, and property being seen as an asset to hold, with historically low returns from many other forms of investment, Bannister added.