House prices hit a new all time high in July as the property market gradually reopened, after being put on pause during the coronavirus lockdown.
According to the latest Halifax House Price Index the average price of a home was £241,604 last month, 1.7% higher than June’s £237,834.
Prices are 3.8% higher than July 2019.
Halifax managing director Russell Galley said pent-up demand and a lack of available houses had combined to push up prices.
The government’s cut in stamp duty had also boosted buyers’ enthusiasm, he said.
Last month Chancellor Rishi Sunak announced a temporary suspension of stamp duty on property sales up to £500,000 in England and Northern Ireland.
These latest figures mirror recent figures from the Nationwide Building Society, which showed house prices bounced back in July, climbing 1.7% during the month.
“The latest data adds to the emerging view that the market is experiencing a surprising spike post lockdown,” said Mr Galley.
But he warned that while the prospects for the housing market were brighter than might have been expected three months ago, the effects of the pandemic were still creating a great deal of long-term uncertainty.
“As government support measures come to an end, the resulting impact on the macroeconomic environment, and in turn the housing market, will start to become more apparent,” he added.
This view was echoed by Anna Clare Harper, author of Strategic Property Review, who said that the Halifax findings reflected current confidence in the economy:
“What we can’t forecast is what happens next: economically, and in policy.
“What we can predict accurately is that these two factors will prove fundamental to the future of the UK housing market.”, she said.
Another property specialist, Tomer Aboody, director of MT Finance, called on the government to consider further stamp duty relief on properties selling for more than £500,000 as he stressed the importance of the sector to the UK economy.
“Now more than ever the housing industry should be looked upon as the foundation upon which to keep the UK working.”