U.K. Home Prices Jump to Record as Sales Reach All-Time High
(Bloomberg) -- Asking prices for U.K. homes climbed to a record in October as agents saw the highest number of sales ever agreed in a month amid a tax-cut fueled boom.
Advertised prices climbed 5.5% from a year earlier, the most in over four years, property website Rightmove said Monday. Average values rose 1.1% from September to 323,530 pounds ($420,000).
A reduction in a levy on home purchases designed to spur activity, as well as pent-up demand after Britain’s national lockdown earlier this year, have left agents with more sold properties than available ones for the first time ever, according to the report.
Sales are up 70% from the same month a year ago, Rightmove said. Prime Minister Boris Johnson has signaled even more support for the market, with a promise of more generous home loans for millions of first-time buyers.
Even so, concerns about the strength of the economic recovery, anticipated job losses and the end of the tax break in March are all weighing on the outlook. Rightmove expects annual price growth rate to peak at around 7% by December.
“Whilst activity levels continue to amaze there are some signs of momentum easing off from these unprecedented levels,” said Tim Bannister, the website’s director of property data.
Most businesses do not expect demand to return to pre-pandemic levels until at least next summer, according to a separate report published Monday. Deloitte’s quarterly survey of chief financial officers found 62% said it won’t happen until after the second quarter of 2021.
Employers plan to keep, on average, 82% of their furloughed staff after the wage support program winds down at the end of this month, the poll of 102 CFOs found.
Brexit could add to economic troubles, though, with participants reporting that they will decrease hiring and capital expenditure more prominently over the next year if no trade deal is reached.
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