Tax break extension pumps up UK house prices in March: Halifax

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British house price growth accelerated last month after finance minister Rishi Sunak extended a tax break for property purchases in his March budget, a survey showed on Friday.

Mortgage lender Halifax said house prices rose 1.1% in monthly terms during March, the biggest increase in six months and compared with a flat reading in February.

In annual terms, house prices rose 6.5% in March, the strongest reading in four months and taking the average house price to a record high 254,606 pounds ($348,683), Halifax said.

The survey chimed with a report on Thursday from the Royal Institution of Chartered Surveyors, which also reported a renewed upturn in the housing market last month.

In his March budget, Sunak extended a temporary cut to property purchase tax, known as stamp duty, and announced a new mortgage guarantee scheme for first-time buyers who cannot afford large deposits.

“The continuation of government support measures has been key in boosting confidence in the housing market,” said Russell Galley, Halifax managing director.

“The extended stamp duty holiday has put another spring in the step of home movers, whilst for those saving hard to buy their first home, the new mortgage guarantee scheme provides an alternative route onto the property ladder.”

Galley said he expected the upturn to persist in the coming months, bolstered by a recovery in consumer confidence spurred by Britain’s swift COVID-19 vaccine roll-out.

“However, with the economy yet to feel the full effect of its biggest recession in more than 300 years, we remain cautious about the longer-term outlook,” he added.

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