According to the latest Halifax House Price Index, annual house price inflation went up to 7.4% in September – this is up from 7.2% with the average UK property price now at a record £267,587. Scotland has continued to outperform the rest of the UK.
House prices in the UK rose by 1.7% in September – this is the strongest rise since February 2007 pushing up inflation to 7.4%, reversing the three-month downward trend in annual growth peaking at 9.6% in May of this year. The average price of a house in the UK is now as expensive as it’s ever been at around £267,500.
There are several reasons for this continued upturn in house prices and the sustained buoyant property market – not just the Stamp Duty (LBTT) holiday (which ended three months later in England than in Scotland), but also the change in buyer priorities and a trend for more internal and external space. Over the past year, the price of flats is up by 6.1% compared to houses rising by 8.9% for semi-detached and 8.8% for detached. Looking at this in asking prices – this means flats have gone up on average by £6.640 and houses by £41,000.
With reports of increasing household bills, potentially rising taxes and NI, as well as fuel bills looking set to go up substantially, there could be lower levels of buyer activity in the coming months. However, borrowing costs are still very low and the job market looks strong which may offset this.
The main factor in rising house prices is the limited supply of available properties, especially in terms of the number of houses for sale, and so this could underpin average prices well into 2022.
With an annual growth of 11.5% in September, Wales has recorded the strongest house price inflation of any UK region or nation. This is followed by Scotland which also outperforms the UK national average, with growth of 8.3% and an average house price of £188,525.
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