The local property market has continued to boom this year and in the UK generally, with the annual house price growth in the UK hitting 12.6% Year on Year, at the end of February. (Data from Nationwide House Price index). Although the March data is still being finalised, initial indications show an increased continued growth, with no signs of slowing.
In the near-term, high demand and a shortage of new properties coming onto the housing market are likely to push up house prices even further, and it would appear that many potential buyers have not been deterred by increasing costs.
Inflation is rising faster than wages are growing, but it will not outpace UK house price growth anytime soon, according to a major housebuilder.
The ONS said increases in household and transport costs, such as electricity, gas and fuel bills, were the largest drivers in the rise of the Consumer Prices Index (CPI) measure of inflation to 6.2%, and yet Bellway, a top five UK housebuilder by number of homes built, said on Tuesday that rising house prices will continue to offset the impact of inflation.
Despite his short-term house price growth expectations, Jason Honeyman, chief executive at Bellway, accepts that rising costs is likely to cause demand for property to eventually slow in the medium- to longer-term.