House prices in the UK continued increasing in April in the run-up to the stamp duty holiday’s deadline, with an increase of 1.4% compared with March, and an increase of 8.2% when compared to April last year. This increase is the highest annual growth rate in five years.
Quarterly Increase
Halifax’s monthly house price index suggests that in the most recent quarter (February to April), house prices were 0.9% higher than in the previous quarter (November to January. In cash terms, this means that close to £20,000 has been added to the average house price since April 2020.
Sam Najafi, property writer, believes that as the stamp duty ends, its influence will fade as it is tapered out. However, house prices are likely to still be affected by low interest rates, low stock levels, and continued demand.
Mortgage Approvals
Professionals within the industry believe that there is a fear amongst buyers that they may miss out if they do not purchase quickly and as house prices continue to increase. New figures from the Bank of England show that mortgage borrowing reached £11.8bn in March; the highest month since 1993 when records began.
Accommodation Types
According to statistics from the Office for National Statistics, the pandemic is likely to have caused buyers to reassess their requirements. In the year to December 2020, the average price of detached properties increased by 10%, whereas flats and maisonettes only increased by 5% over the same period.
Figures from housing website Zoopla show that demand for property in the UK is up 27.5% year to date in 2021 when compared with average levels from 2020.
Regions
London had the lowest annual growth, with house prices increasing by just 3.5% over the year to December 2020, down from 7% in November. This slowing in London’s pricing is down to the fact that prices decreased by £5,000 in November and December, whilst earlier in 2020 they increased by £10,000. London’s average house price remains the highest of all regions in the UK at £496,000.
The North East’s average house prices are still the lowest, as £141,000. This is the final region in England to pass its peak from June 2007.