By David Milliken
LONDON – Asking prices for British houses have recorded their sharpest monthly jump for the time of year since March 2004, despite a growing squeeze on households’ disposable income from higher energy bills and rising interest rates.
Property website Rightmove – which says it covers 95% of homes put up for sale in the United Kingdom – reported that the number of prospective buyers was twice the number of homes for sale, also a record for the time of year.
But the company added that it was too soon to know how prices would be affected by Russia’s invasion of Ukraine, which the Bank of England warned on Thursday would intensify short-term inflation pressures at a time when living standards already faced their biggest squeeze in 30 years.
“We forecast a less frothy market in the second half of the year, as economic headwinds lead to a more evenly balanced market, though demand will still outstrip supply,” it said.
Asking prices recorded between Feb. 13 and March 12 were 10.4% higher than a year before, and 1.7% higher than the previous month.
This represented the biggest annual rise since June 2014 and the largest monthly increase for March since 2004.
Asking prices in London, the weakest market since the start of the pandemic, were 6.3% higher than a year ago.
The latest official data, based on registered sale prices, shows prices of homes sold in December were 10.8% higher than a year before, down from a peak rate of 13.5% in June, just before a temporary tax break on home purchases began to be phased out.
Britain, like most Western countries, saw an unexpected surge in house prices during the COVID-19 pandemic as many richer households sought bigger homes due to lockdown and reduced commuting.
So far there has been little sign of a slowdown in house price rises to pre-pandemic rates, even as the BoE has raised interest rates three times since December and consumer price inflation hit its highest in almost 30 years.
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