House prices keep on rising

IN LINE WITH

LEICESTERSHIRE

THE cost of housing in Leicestershire is rising at its fastest rate since 2005.

House prices have soared across the UK in recent years and pushed further with the impact of the pandemic and cuts to stamp duty leading to higher asking prices.

In Leicester, the average home cost £206,297 in June, which is a 13.2 per cent rise on a year ago, when it was £182,286.

That is the biggest annual jump in prices recorded since March 2005 - with homes in the area having an extra £24,011 being added to the price.

The rest of Leicestershire has also seen a big rise, with the average home costing £260,789 in June, a jump of 11.9 per cent from the £233,042 average recorded 12 months previously.

It means, on average, an extra £27,747 has been added to county house prices within a year.

The biggest jump in prices was in Melton, where sales were on average £254,862 in June, up 16.8 per cent from the average of £218,287 the year before. This is a price difference of £36,575.

Nationally, average house prices have increased by 13.2 per cent over the same period, and across the UK this is the highest annual growth rate recorded since November 2004.

This meant that the UK’s average house price reached a record high of £266,000, up by £31,000 compared to this time last year.

Average house prices in England increased over the year to £284,000 - an increase of 13.3 per cent, in Wales to £195,000 (16.7 per cent), in Scotland to £174,000 (12.0 per cent) and in Northern Ireland to £153,000 (9.0 per cent).

House price growth was strongest in the North West where prices increased by 18.6 per cent in the year to June.

The lowest annual growth was in London, where prices increased by 6.3 per cent.

The most recent year covers the full extent of stamp duty cuts put in place across Britain following the first lockdown.

The Office for National Statistics suggests the change in tax may have led to sellers requesting higher prices, in the knowledge that buyers’ overall costs were reduced.

On July 8, 2020, the Chancellor of the Exchequer announced a suspension of the tax paid on property purchases with immediate effect in England and Northern Ireland.

Similar stamp duty suspensions came into effect slightly later, on July 15 in Scotland and July 27 in Wales.

In England and Northern Ireland, properties up to the value of £500,000 would incur no tax, while the threshold for Scotland and Wales was £250,000.

The type of house in demand may also be affecting average prices, as the pandemic has made people reassess their home preferences.

Prices for detached homes rose 15.6 per cent in the year to June, with a 13.5 per cent rise for semidetached, and a 14.0 per cent rise for terraces.

However, flats only saw prices rise by 8.4 per cent over the year.

Bank of England analysis reported ongoing strong demand for housing across most of the UK in the quarter to June and a shortage of properties for sale, which pushed up prices.

AVERAGE UK RISES