"Increasing demand is combining with very low supply to drive robust underlying house price growth."
- Halifax
British house prices dropped the most in more than a year on a monthly basis in September. According to Halifax survey, the average cost of a home declined 0.9% from the previous month, compare to a 2.7% surge in August, while market expected prices to rise by a monthly 0.1%. Nevertheless, the mortgage lender noted in the statement that monthly changes are volatile and strengthening demand for homes in the UK means the dip may be temporary. From a year earlier, house prices advanced 8.5% in September, down from 9% in the prior month.
Meanwhile, the Halifax also added that housing demand in the UK has been strengthening recently, underpinned by economic growth, rising real earnings and very low mortgage rates. Therefore, there is little reason to expect any fundamental shift in the key market drivers over the coming months. At the same time, the Halifax survey contrasted with another measure of British house prices, compiled by rival mortgage lender Nationwide, which found prices rose more quickly in September than in August.
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