Thanks BBC News and The Telegraph for publishing my thoughts on the latest house price data from Nationwide, which make for interesting reading. Quick summary below:
5.8% house price growth in the year to October reflects positive forces that are applying uniquely to the housing market.
Prices are being buoyed up by the temporary Stamp Duty Land Tax reduction, the release of pent up demand and supply, and the desire to improve surroundings following lockdown.
House price growth also reflects uncertainty and lack of alternatives. If you are getting low or no returns to other investments, you are more likely to choose the tangibility and security that comes with putting money into bricks and mortar.
Some are concerned we are moving into ‘boom’ territory, with homeowners and investors encouraged by low interest rates. No surprise that mortgage approvals hit the highest level (91,500) since 2007.
The good news is, interest rates are low and are likely to remain so.
There is more good news in the qualitative data: many more people are prioritising minimising the environment in their property decisions, including enhancing their homes to minimise their carbon footprint and maximise energy efficiency. This is vital, and will prove helpful for meeting the UK Government’s 2050 emissions targets.