UK house prices reach record high
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UK house prices increased by 7.6 per cent in the year to November 2020 to reach a record high of £250,000, the Office for National Statistics (ONS) has revealed.
This is the highest annual growth seen in the UK since June 2016, and was an increase on the annual uplift of 5.9 per cent recorded in October.
Average London property prices also passed the half a million mark for the first time, the UK House Price Index said, reaching an average of £514,000.
The capital had the joint highest annual growth in the UK at 9.7 per cent, a position shared with Yorkshire and the Humber. The East of England – home of Hertfordshire – recorded the lowest annual growth, at 4.8 per cent.
The average price of a house in England increased to £267,000 (up 7.6 per cent), compared to £180,000 (7 per cent) in Wales, £166,000 (8.6 per cent) in Scotland and £143,000 (2.4 per cent) in Northern Ireland.
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Ross Counsell, director at Good Move, said we can put this growth down to “the influx of people looking to buy property in 2020, both before the end of the stamp duty holiday in March, and due to many people simply looking for more spacious properties, particularly in rural locations, during lockdown.
“Mortgage approvals too are at an all-time 13 year high, and with such high demand for properties and mortgages, naturally comes higher average house prices. The property market is incredibly competitive, and becoming increasingly more selective for lenders choosing who to lend to.”
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He added: "However, it's not all bad news. Despite these record high house prices, we expect them to fall after the end of the stamp duty holiday in March. And as the world hopefully resumes some normalcy this year, we do not expect 2021 to follow 2020's footsteps with the staggeringly high house prices, and we therefore expect 2021 to be a solid year for buyers."
James Forrester, managing director of Barrows and Forrester, said: “A 7.6 per cent annual increase is pretty astonishing and demonstrates the momentum that is now driving the UK market forward at a rapid pace.
“We’ve seen a sustained level of strong growth for some months now and this is largely due to more demand but also as a result of buyers who will have stretched their budget and the price they’re willing to pay for a home due to the money they will have saved on stamp duty.
“Although it’s only natural that this rate of house price growth will slow once the stamp duty holiday deadline arrives, any predictions of market activity evaporating overnight are grossly exaggerated.”