# UK housing market keeps momentum but slowdown ahead: Halifax
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-09-07
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: UK House Prices Rise in August Despite Economic Woes
Meta Description: Despite economic challenges, British house prices rose in August, with analysts expecting a slowdown. New government initiatives could provide relief to the
URL: https://financedigest.com/uk-housing-market-keeps-momentum-but-slowdown-ahead-halifaxhtml

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LONDON (Reuters) -British house prices rose in August although a torrid economic outlook spells trouble for the housing market in the months ahead, mortgage lender Halifax said on Wednesday.

Prices increased by 0.4% month-on-month in August after a 0.1% dip in July, Halifax said. In annual terms, they were 11.5% higher, the lowest such rate in three months.

The survey echoed other signs that show the housing [market has maintained much of its momentum](https://www.financedigest.com/maintaining-momentum-using-trends-to-beat-the-market.html "Maintaining momentum: using trends to beat the market") despite soaring inflation. However, most analysts [expect a slowdown](https://www.financedigest.com/ea-lowers-bookings-expectation-on-strong-dollar-gaming-slowdown.html "EA lowers bookings expectation on strong dollar, gaming slowdown") in the coming months as the cost-of-living crunch tightens.

[“House prices](https://www.financedigest.com/buy-off-plan-to-beat-stalling-house-prices-and-falling-rental-yields-says-jean-liggett.html "“Buy off-plan to beat stalling house prices and falling rental yields” says Jean Liggett ") are unlikely to defy the economy’s wider problems indefinitely,” said Martin Beck, chief economist adviser to the EY ITEM Club consultancy.

However, he said new prime minister Liz Truss’s plan to cap [household energy bills](https://www.financedigest.com/44-of-uk-households-are-worried-theyll-have-to-foot-the-bill-for-net-zero.html "44% of UK Households are Worried They’ll Have to Foot the Bill for Net Zero") – the details of which are yet to be announced – could lower the downside risks to the market.

By reducing the prospective peak in inflation and dampening inflation expectations among the public, a cap might encourage the [Bank of England to take a less hawkish approach to raising rates](https://www.financedigest.com/bank-of-england-officials-split-over-future-path-for-rates.html "Bank of England officials split over future path for rates"), with knock-on consequences for the cost of mortgages,” Beck said.

The [BoE is expected to raise interest rates](https://www.financedigest.com/uk-economys-unexpected-bounce-spurs-more-boe-rate-hike-talk.html "UK economy’s unexpected bounce spurs more BoE rate hike talk") again next Thursday. One rate-setter said this week it was “an important question” whether the [central bank](https://www.financedigest.com/no-santa-rally-for-markets-as-central-banks-dampen-peak-rate-hopes.html "No Santa rally for markets as central banks dampen peak rate hopes") opts for an 75 basis-point increase, something it has not done since 1989.

Wales saw the highest [rate of annual house price growth](https://www.financedigest.com/u-s-job-growth-powers-ahead-unemployment-rate-at-3-4.html "U.S. job growth powers ahead; unemployment rate at 3.4%") in August, Halifax said. London again lagged other regions, despite [house prices](https://www.financedigest.com/uk-house-prices-stabilise-after-four-month-fall-halifax-says.html "UK house prices stabilise after four-month fall, Halifax says") there rising by 8.8% – the fastest uptick in over six years.

(Reporting by Andy BruceEditing by William Schomberg)


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