UK property prices rise at fastest rate since 2016

Financial Times reports that average UK house price growth reached a four-year high in November, according to official statistics that show lockdown lifestyle shifts and government measures boosted property prices in spite of economic slowdown. UK average house prices increased 7.6 per cent in the year to November 2020 — the highest rate since June 2016 — up from 5.9 per cent in October, according to the official house price index released by the Office for National Statistics on Wednesday. The average house price across the UK is now £250,000 while in London prices passed £500,000 for the first time. Pent-up demand after the first lockdown and the government’s stamp duty holiday on the first £500,000 of residential property purchases both helped drive prices higher.

But property market analysts expect the boom to be shortlived with the stamp duty exemption ending in March and more people losing their jobs as the economic impact of the pandemic bites. More recent, unofficial indicators of house prices suggest the market is already beginning to waver. The Halifax monthly house price index for December rose at its lowest rate since June, and a respected survey from the Royal Institution of Chartered Surveyors showed sales, new inquiries and price expectations had softened. The ONS said the type of transactions recorded in November indicated changing buyer preferences. In the year to November the average price of detached homes increased 8.5 per cent compared with 5.4 per cent for flats and maisonettes. Price growth in London jumped 9.7 per cent in the year to November, compared with 4.6 per cent the previous month, making it the region with the fastest growth alongside Yorkshire and the Humber.