Average house price up £22,000
MAJOR SURGE IN VALUES NATIONWIDE... BUT THE NORTH IS OUTPACING THE SOUTH AS REMOTE WORKING INCREASES
HOUSE prices increased by 9.5% annually in May to reach a new record high of £261,743 on average, according to an index.
Halifax said annual house price inflation was at its strongest level in nearly seven years.
Annual house price growth was strongest in Wales, with values soaring by 11.9%.
The national surge means that the average UK home has increased in value by more than £22,000 over the past 12 months as major shifts in the way we live and work brought about by the Covid-19 pandemic filter into the housing market.
Russell Galley, managing director at Halifax, elaborated: “House prices have reached another record high in May, with the average property adding more than £3,000 (1.3%) to its value in the last month alone.”
Russell explained that the Government’s stamp duty holiday has boosted activity, adding: “For some homebuyers, lockdown restrictions have also resulted in an unexpected build-up of savings, which can now be deployed to fund bigger deposits for bigger properties, potentially pushing property prices even higher.
“While these effects will be temporary, the current strength in house prices also points to a deeper and long-lasting change as buyer preferences shift in anticipation of new, post-pandemic lifestyles – as greater demand for larger properties with more space might warrant an increased willingness to spend a higher proportion of income on housing.”
Russell said all UK nations and regions except the north east of England witnessed an acceleration in annual house price inflation in May.
He said of annual house price growth: “For Wales and the North West, these are the biggest percentage gains since April 2005, and for Yorkshire and the Humber since June 2006.
“The south of England, traditionally the driving force of national house price performance, is for once lagging somewhat behind the rest of the country.”
Mark Harris, chief executive of mortgage broker SPF Private Clients, shared his view of recent shifts in the market, saying: “House price growth in the south of England may be behind the rest of the country but property prices are still more expensive there than elsewhere.”
He continued: “While buyers are prepared to go further in the search for more space and less need to be in the office every day, pushing up demand for property away from the capital, it remains to be seen whether this is a longterm trend or whether the attraction of city centres will return at some point.”