Despite higher living costs, buyer demand for properties remains strong, and we’ve seen another property price increase in March.
The housing market has maintained momentum, with UK prices increasing by 1.4 per cent in March according to Halifax.
The average property price has reached a new record high of £282,553 according to the lender.
Two years on from the first lockdown, house prices have risen by an average of £43,577. Since the start of the first lockdown in March 2020, the average house price has risen by 18.2 per cent.
‘Average UK house prices rose again in March for the ninth time in a row,’ says Russell Galley, Managing Director of Halifax. ‘With 2021’s strong momentum continuing into the beginning of this year, the annual rate of house price inflation continues to track around its highest level since 2007. The new record price is up some £28,113 on a year ago.’
This marks an annual increase of 11 per cent and a quarterly increase of 2.3 per cent. Halifax says the reason for the consistent increase is the limited supply of properties for sale and strong buyer demand.
Too few properties
‘The fundamental issue remains that too many buyers are chasing too few properties,’ says Galley. ‘The effect on house prices makes it increasingly difficult for first-time buyers looking to make their first step onto the property ladder, but also challenges homeowners who face ever bigger leaps to move up the rungs to a larger property.’
The best performing areas in terms of annual house price growth are the South West of England, Wales, and Northern Ireland. The South West of England has overtaken Wales as the UK’s strongest performer in house price inflation, with an annual price increase of 14.6 per cent, the highest increase since September 2004. The average house price in the South West is now £298,162.
Notable growth areas
Wales has seen annual growth of 14.1 per cent, with the average house price now standing at £211,942.
Northern Ireland has seen annual growth of 13 per cent, with the average house price now at £177,265.
Other areas with notable growth include East Midlands – which has seen annual price increases of 12.3 per cent, with the average house price now at £234,083 and Eastern England, with annual growth of 11.7 per cent and an average price of £330,883.
However, Halifax adds that rising interest rates and a higher cost of living could result in a slowing of house price inflation over the next year.