The strongest growth in London in six years propelled UK average house prices to an average high of £294,260 ($338,089) in August, data from UK bank Halifax shows.
The figure marks a 0.4 per cent rise from July after a 0.1 per cent dip the month before, the first fall in a year.
The increase defied predictions that the cost of living crisis and soaring inflation would puncture the strength of the property market, which kept growing through the pandemic and last recession.
“While house prices have so far proved to be resilient in the face of growing economic uncertainty, industry surveys point towards cooling expectations across the majority of UK regions, as buyer demand eases, and other forward-looking indicators also imply a likely slowdown in market activity,” Kim Kinnaird, director of Halifax Mortgages, said on Wednesday.
Ms Kinnaird expects a “more challenging period” for house prices in the coming months because gains have stretched affordability for many purchasers. This was analysis shared by Bestinvest personal finance analyst Alice Haine, who described the market as being "on the turn".
“With the average two-year fixed deal hitting 4.2 per cent last week, it’s no wonder that some buyers are pausing plans to buy until the economy stabilises, while others accelerate their purchases in a bid to beat the interest-rate rises," she said.
Ms Haine sees uncertainty as a crucial factor in a likely market slowdown.
"While the message to potential sellers in the current climate from some quarters is to get their house listed now before the market drops, the outlook from here is increasingly uncertain," she said.
"A new prime minister means a new fiscal strategy and the country is now in a state of flux as it waits to hear what measures Liz Truss will put in place to support households through the cost of living crisis this winter.
"If the PM does indeed go ahead with the reported freeze on domestic gas and electricity prices, then inflation may peak at a more modest figure this year — rather than the dizzying highs of more than 22 per cent in January that some analysts were expecting.
“Such a move ... could also ease the pressure on the Bank of England to hike interest rates even further, allowing it to focus instead on boosting the economy to ward off recession rather than constraining it.
Mortgage rates at six-year high
Mortgage rates are now at their highest since 2016 after six interest-rate increases from the Bank of England since December, with another half-point rise expected next week.
The annual rate of house price growth was 11.5 per cent, little changed from the previous month’s 11.8 per cent. London and Wales were the strongest regions for sales, with prices in the capital jumping 8.8 per cent from a year ago, the most in six years. Wales had the fastest growth since 2005, up by 16.1 per cent.
The figures confirm a reading from the UK’s other main mortgage lender, which also registered growth in the market in August, typically a month where prices soften.
Nationwide Building Society said the average cost of a home rose by 0.8 per cent in August to £273,751, the 13th consecutive monthly increase.
“The Bank of England is widely expected to continue raising interest rates, which will also exert a cooling impact on the market if this feeds through to mortgage rates, which have already increased noticeably in recent months,” said Nationwide chief economist Robert Gardner.
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Ways to control drones
Countries have been coming up with ways to restrict and monitor the use of non-commercial drones to keep them from trespassing on controlled areas such as airports.
"Drones vary in size and some can be as big as a small city car - so imagine the impact of one hitting an airplane. It's a huge risk, especially when commercial airliners are not designed to make or take sudden evasive manoeuvres like drones can" says Saj Ahmed, chief analyst at London-based StrategicAero Research.
New measures have now been taken to monitor drone activity, Geo-fencing technology is one.
It's a method designed to prevent drones from drifting into banned areas. The technology uses GPS location signals to stop its machines flying close to airports and other restricted zones.
The European commission has recently announced a blueprint to make drone use in low-level airspace safe, secure and environmentally friendly. This process is called “U-Space” – it covers altitudes of up to 150 metres. It is also noteworthy that that UK Civil Aviation Authority recommends drones to be flown at no higher than 400ft. “U-Space” technology will be governed by a system similar to air traffic control management, which will be automated using tools like geo-fencing.
The UAE has drawn serious measures to ensure users register their devices under strict new laws. Authorities have urged that users must obtain approval in advance before flying the drones, non registered drone use in Dubai will result in a fine of up to twenty thousand dirhams under a new resolution approved by Sheikh Hamdan bin Mohammed, Crown Prince of Dubai.
Mr Ahmad suggest that "Hefty fines running into hundreds of thousands of dollars need to compensate for the cost of airport disruption and flight diversions to lengthy jail spells, confiscation of travel rights and use of drones for a lengthy period" must be enforced in order to reduce airport intrusion.
Who was Alfred Nobel?
The Nobel Prize was created by wealthy Swedish chemist and entrepreneur Alfred Nobel.
- In his will he dictated that the bulk of his estate should be used to fund "prizes to those who, during the preceding year, have conferred the greatest benefit to humankind".
- Nobel is best known as the inventor of dynamite, but also wrote poetry and drama and could speak Russian, French, English and German by the age of 17. The five original prize categories reflect the interests closest to his heart.
- Nobel died in 1896 but it took until 1901, following a legal battle over his will, before the first prizes were awarded.
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COMPANY PROFILE
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Founders: Iheb Triki and Mohamed Ali Abid
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Sector: Water technology
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WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
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Robbie Keane (Atletico de Kolkata) The Irish striker is, along with his former Spurs teammate Dimitar Berbatov, the headline figure in this season’s ISL, having joined defending champions ATK. His grand entrance after arrival from Major League Soccer in the US will be delayed by three games, though, due to a knee injury.
Dimitar Berbatov (Kerala Blasters) Word has it that Rene Meulensteen, the Kerala manager, plans to deploy his Bulgarian star in central midfield. The idea of Berbatov as an all-action, box-to-box midfielder, might jar with Spurs and Manchester United supporters, who more likely recall an always-languid, often-lazy striker.
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Andre Bikey (Jamshedpur) The Cameroonian defender is onto the 17th club of a career has taken him to Spain, Portugal, Russia, the UK, Greece, and now India. He is still only 32, so there is plenty of time to add to that tally, too. Scored goals against Liverpool and Chelsea during his time with Reading in England.
Emiliano Alfaro (Pune City) The Uruguayan striker has played for Liverpool – the Montevideo one, rather than the better-known side in England – and Lazio in Italy. He was prolific for a season at Al Wasl in the Arabian Gulf League in 2012/13. He returned for one season with Fujairah, whom he left to join Pune.
