Phoebus: Rising house prices may not be sustainable

The question of whether continued rising house prices is sustainable has been asked by Richard Pike, sales and marketing director at Phoebus Software.

Pike was responding to the latest data by HMRC.

Richard Pike said: “We have now reached a point where the impetus created by the stamp duty payment holiday has taken property transactions above the level in the same month last year.

Sales agreed up 38% annually

“However, as can be seen by the increase in the receipts from the stamp duty that is still being paid on properties over £500,000, house prices are being pushed up by the demand.”

While the government attempts to increase the number of people in the property ladder, Pike outlines that what it appears is being created is a false ceiling that many younger people will struggle to break through.

Affordability is an area which has suffered drastically as a result of the pandemic, with many would-be buyers pulling out of deals due to being furloughed.

Pike said: “The Chancellor’s spending review tomorrow is unlikely to include anything further on housing, but stranger things have happened and, when receipts for stamp duty continue to flood into the treasury, an extension to the payment holiday may be on the cards.

“Whether that is good for the long term health of the market is another question.”