Soaring house prices in 2020 likely to slow this year

UK property prices crept up by 6% last year, according to the Halifax, but the lender is predicting "downward pressure" on values in 2021. The mortgage lender, part of Lloyds Banking Group, said that prices "soared" in the second half of 2020. Pent-up demand, a clamour for more space, and stamp duty holidays led to higher prices. However, the Halifax said the economic realities of 2021 meant activity would slow as the year progressed. Prices were at a record high in December, but growth has already started to slow. There was a 0.2% month-on-month increase in December, but this was significantly less than the 1% jump recorded in November. It was the lowest rate recorded during the six months of growth since the housing market started to reopen in England in May. "With the pace of the UK's economic recovery expected to be constrained by the renewed national lockdown, and unemployment widely predicted to rise in the coming months, downward pressure on house prices remains likely as we move through 2021", said Russell Galley, managing director at the Halifax.

BBC News (08/01/2021)   Financial Times (08/01/2021)   The Daily Telegraph (08/01/2021)   Financial Times (08/01/2021)