Average UK house prices rose by 7.6% in the year to November to reach a record high of £250,000, according to the ONS House Price Index.
The data shows that this increase is the highest annual growth rate the UK has seen since June 2016.
In addition, this is up from the year to October, which noted a 5.9% rise.
Average house prices increased over the year in England to £267,000 (7.6%), Wales to £180,000 (7.0%), Scotland to £166,000 (8.6%) and Northern Ireland to £143,000 (2.4%).
The average house price in London surpassed £500,000 for the first time in November 2020.
Furthermore, the North East is the final English region to surpass its pre-economic downturn average house price peak of July 2007, to now stand at £140,000.
Kevin Roberts, director of Legal & General Mortgage Club, said: “The latest ONS house price index figures will be welcomed by existing homeowners.
“The resilience of the housing market continues to shine through as people remain encouraged to move house with or without the benefit from the stamp duty relief, no doubt also encouraged by the rollout of the a COVID-19 vaccine.
“There remain challenges, however, and the government’s decision to extend the furlough scheme until the end of March, will be welcomed by many homeowners exploring their options.
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“At Legal & General Mortgage Club, we saw searches for furlough friendly mortgages increase by 230% in November 2020, when compared to the previous month.”
“Buyers wanting to access the best and most suitable mortgage products should absolutely consider speaking with an independent mortgage adviser, particularly as we draw closer to the government’s stamp duty holiday deadline, which is creating very high demand.”
Paul Stockwell, chief commercial officer of Gatehouse Bank, added: “House prices defied expectations by increasing throughout 2020 and leading to a record high in November, with the stamp duty discount driving strong demand from buyers — but there are signs from other indices that price growth has now begun to slow.
Read about the UK Housing Market via our Specialist Residential & Buy to Let Division
“The UK housing market is still open for business during this lockdown, but demand is likely to have started to taper off as buyers begin to concede they will not be able to complete a transaction in time to make the stamp duty deadline.
“The March 31 cut-off is looming, and although professionals across the industry are working in earnest to get applications over the line in time, fears are mounting about how many agreements could fall through.
“With property portal Rightmove predicting as many as 100,000 buyers could face an unwelcome tax bill when their sale fails to complete on time, all eyes are turning to Chancellor Rishi Sunak and whether he may extend or add a taper mechanism to the scheme or risk deals falling apart.”
Guy Gittins, managing director of Chestertons, said: “The second lockdown no doubt encouraged some people to put their property search on hold, but we didn’t notice a big difference and activity levels were still a lot higher than we anticipated for this time of year.
“Part of this was driven by the incentive of the stamp duty saving, but we believe the main driver was that people just wanted to move as quickly as possible while conditions were favourable.”
By Jake Carter
Source: Mortgage Introducer
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