British house prices rose in July after falling in June as demand for bigger homes following pandemic lockdowns helped to soften the impact of a reduced tax break for buyers, mortgage lender Halifax said on Friday.

House prices last month were 0.4% higher than in June when they fell by a monthly 0.6%, Halifax said.

In annual terms, prices were 7.6% higher than in July 2020, the slowest rise since March.

Russell Galley, Halifax managing director, said he expected the market to settle after the recent buying surge which was driven by the tax incentive, but a shortage of home on the market was likely to support prices.

Under the incentive scheme, the first 500,000 pounds ($696,000) of any property purchase in England or Northern Ireland were exempt from the stamp duty tax until the end of June. A 250,000 pound tax-free allowance is now running until the end of September.

The FTSE MIB climbed up by 0.06% to 25,678.82. In the cash markets, the DAX  Germany was trading down 0.05%  to 15,739.17. CAC 40  in France fell  by 0.16% to 6,770.60 while the FTSE 100  in the U.K. were down by 0.10% to 7,112.35. ,at the time of writing.