LONDON (Reuters) – British house prices rose by the most in six months in July when they increased by a slightly faster than expected 0.4% from June, according to figures from mortgage lender Halifax that add to signs of a stabilisation in the housing market.
Economists polled by Reuters had expected prices to rise by 0.3% in month-on-month terms after a 0.1% gain in June.
Halifax said on Thursday house prices were 2.4% higher compared with July last year, slowing from June’s 2.7% increase.
Britain’s housing market has settled after a rush to beat the expiry in April of a tax break for some home buyers which depressed sales immediately after the deadline.
“Challenges remain for those looking to move up or onto the property ladder. But with mortgage rates continuing to ease and wages still rising, the picture on affordability is gradually improving,” Amanda Bryden, Halifax’s head of mortgages, said.
“We expect house prices to follow a steady path of modest gains through the rest of the year,” she said.
The Bank of England is widely expected to cut its main interest rate to 4% from 4.25% later on Thursday but the outlook for further reductions in borrowing costs is unclear due to persistent inflation pressures, even as the jobs market cools.
Rival lender Nationwide said last week its measure of house prices rose by 0.6% in July compared with June.
(Writing by William Schomberg; editing by James Davey)
