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| House price rises sped up in July, says Nationwide | House price rises sped up in July, says Nationwide |
| (about 11 hours later) | |
| The pace of increase in UK house prices accelerated in July, rising by 3.5% compared with a year earlier, according to the Nationwide. | The pace of increase in UK house prices accelerated in July, rising by 3.5% compared with a year earlier, according to the Nationwide. |
| The building society said that the annual change picked up from 3.3% a month earlier. | The building society said that the annual change picked up from 3.3% a month earlier. |
| Property values rose by 0.4% in July compared with June, taking the cost of the average home to £195,621. | Property values rose by 0.4% in July compared with June, taking the cost of the average home to £195,621. |
| Demand for housing remained "encouraging", the report said, but supply strength was "unclear". | Demand for housing remained "encouraging", the report said, but supply strength was "unclear". |
| Nationwide's chief economist Robert Gardner said: "The number of new homes under construction has started to pick up, albeit from historically low levels, and further increases are required if a sustainable recovery in the housing market is to be maintained over the longer term." | Nationwide's chief economist Robert Gardner said: "The number of new homes under construction has started to pick up, albeit from historically low levels, and further increases are required if a sustainable recovery in the housing market is to be maintained over the longer term." |
| Mr Gardner said that the house price growth might be "stabilising close to the pace of earnings growth" which had historically been around 4% a year. | Mr Gardner said that the house price growth might be "stabilising close to the pace of earnings growth" which had historically been around 4% a year. |
| Estate agents and analysts point out that the market could be affected by a potential change in interest rates at the turn of the year. | Estate agents and analysts point out that the market could be affected by a potential change in interest rates at the turn of the year. |
| "The one blot on the horizon is a potential interest rate rise, which may slow down the mainstream market as buyers become concerned that their mortgage will cost more," said Jonathan Adams, director of estate agency Napier Watt. | "The one blot on the horizon is a potential interest rate rise, which may slow down the mainstream market as buyers become concerned that their mortgage will cost more," said Jonathan Adams, director of estate agency Napier Watt. |
| "Buyers often do not realise the impact of a rate rise until the first one actually happens." | "Buyers often do not realise the impact of a rate rise until the first one actually happens." |
| Stamp duty | Stamp duty |
| The Nationwide has also studied the effect of the change in stamp duty rules that were announced in Chancellor George Osborne's Autumn Statement last year. | The Nationwide has also studied the effect of the change in stamp duty rules that were announced in Chancellor George Osborne's Autumn Statement last year. |
| Since December, stamp duty has only applied to the amount of the purchase price that falls within the particular duty band, making it more like income tax. This replaced the old "slab" system. | Since December, stamp duty has only applied to the amount of the purchase price that falls within the particular duty band, making it more like income tax. This replaced the old "slab" system. |
| The Nationwide has estimated that the change has led to £275m less tax being paid. | The Nationwide has estimated that the change has led to £275m less tax being paid. |
| In the first six months since the change, nearly 235,000 buyers in England and Wales have paid less stamp duty than they would have done under the old system, paying £1,800 less each on average. | In the first six months since the change, nearly 235,000 buyers in England and Wales have paid less stamp duty than they would have done under the old system, paying £1,800 less each on average. |
| "The benefits are greatest in the South of England where average house prices are higher," Mr Gardner said. | "The benefits are greatest in the South of England where average house prices are higher," Mr Gardner said. |
| "We estimate that around 85% of transactions in London, the South West of England and South East of England have benefited from the changes, compared with around 55% in the North of England, Yorkshire and Humberside, and the North West of England." | "We estimate that around 85% of transactions in London, the South West of England and South East of England have benefited from the changes, compared with around 55% in the North of England, Yorkshire and Humberside, and the North West of England." |
| He said there was less "bunching" around price points where the thresholds sit, such as £250,000 and £500,000. | He said there was less "bunching" around price points where the thresholds sit, such as £250,000 and £500,000. |
| Some 5,000 buyers paid more stamp duty than they would under the old system, at an average of £28,000. Two-thirds of these buyers were in London. | Some 5,000 buyers paid more stamp duty than they would under the old system, at an average of £28,000. Two-thirds of these buyers were in London. |