Reallymoving: house price growth to slow from August

Monthly house price growth is expected to fall to 0.4% in August 2021, which could mark the beginning of the end of the homebuyer frenzy which has pushed up prices this year.

Reallymoving’s House Price Forecast predicted monthly growth of 2.9% in June, 3.8% in July, before the market begins to cool in August.

House prices are set to get substantially higher than a year ago, with annual growth reaching +8.5% in June, +9.8% in July and rising to +11.1% in August.

Rob Houghton, chief executive of reallymoving, said: “This significant period of growth for the housing market may be showing signs of slowing in pace which will be reflected in completed sale prices in August.

“While demand may be reducing, there’s still a huge volume of activity in the market which is driven predominantly by lifestyle factors as well as tax savings.

“Money is cheap to borrow, workers are enjoying greater freedoms than ever before to live where they choose and with fewer demands on cash savings from holidays and leisure activities, many people remain determined to move and achieve a lifestyle that may previously have been impossible.”

Conveyancing quote volumes on reallymoving peaked in March at more than double the usual level and remained high in April, but dropped by 10% in May, suggested buyer demand is beginning to fall – alongside reports from agents and surveyors that low supply of properties for sale is hindering market activity.

Completed sale prices will rise strongly in June (+2.9%) and July (+3.8%), based on deals agreed in March and April when the property market surged again following news of the stamp duty holiday extension.

Monthly growth in values will continue into August but slow to +0.4%, as the lack of new supply diminishes choice for homebuyers, and the potential tax saving is dramatically reduced, taking the average house price in England and Wales to £330,081.

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