Fears of a rate rise will scare off would-be homebuyers for the rest of the year despite a surprise September spike in house prices, according to the lender Halifax.
The cost of the average home rose 0.6 per cent over the month although longer-term barometers – the average quarterly and annual rate of growth – both showed signs of a cooling market.
Halifax’s housing economist, Martin Ellis, said yesterday: “The recent rapid rise in house prices in some parts of the UK, earnings growth that remains below consumer price inflation and the possibility of an interest rate rise over the coming months appear to have tempered housing demand.”
The figures contrast with those from Nationwide, which reported the first monthly drop in prices for more than a year in September, although the Bank of England has also revealed falling mortgage approvals.
Mr Ellis added: “Annual house price inflation may have peaked around 10 per cent. A moderation in growth looks likely during the remainder of 2014 and into next year as supply and demand become increasingly better balanced.”Reuse content