The growth of home prices in the UK may exceed expectations

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The country’s lender said that the prices of homes in the UK increased more than expected in May, with the support of low unemployment, the growth of strong wages and the mortgage rates.

The average cost of the property increased by 0.5 percent between April and May to 273,427 pounds, and most of them reflect a decrease of 0.6 percent in the previous month, according to the data issued on Monday.

Prices increased by an annual rate of 3.5 percent, up from 3.4 percent in the previous month. Both procedures are stronger than the increase of 0.1 percent on a monthly basis and annual increase of 2.9 percent by the Reuters economists.

“Although economic uncertainty in the global economy,” Robert Gardner, chief economist in NATORWIDE, said that “the basic conditions of potential homes in the UK are still supportive,” said Robert Gardner, the National Senior Economist in Nationwide.

“Unemployment is still low, profits rise at a health pace, home public budgets are strong and borrowing costs are likely to be slightly moderate if the bank rate is reduced in the coming quarters as we expect us, and most other analysts.”

Elliot Jordan-Dawak, an economist in the overall economy consulting consulting, said the numbers indicate that the worst fears of slowdown in home prices after raising closing fees in April will fail to achieve it.

From April 1, stamping sills returned to pre -2022 levels, which increased the tax cost of many ownership Buyers continue in many families who rush to complete transactions before the changes.

For example, buyers for the first time will pay property that costs 300,000 pounds or more, instead of the previous 425,000 pounds.

Jordan Dwak said that the economic background had improved over the past month and supported the demand for housing, as the United Kingdom’s agreement on a commercial deal with the United States took the worst scenario of American definitions on the table. House prices are expected to rise by 4.5 percent this year.

Wages in the United Kingdom grow faster than inflation for about two years, while mortgage rates have decreased.

In May, the Bank of England reduced interest rates by a quarter of a point for the fourth time since mid -year, to 4.25 percent. The markets expect that the Bank of England will reduce a quarter point before the end of this year.

“With the distorted effects of March’s closing changes in the past,” the market returns to a more stable dynamic, as prices are determined again by the interaction of supply and demand, “said Gonathan Hopper, CEO of Garrington Property Finders Garrington.