Industry Reacts to Latest House Price Index

19 May 2021 | Finance, General

The average price of a home in the UK continues to rise, with the latest figures from the Office for National Statistics showing an increase in the year leading up to March of 10.2 per cent.

With the average price of a home now at a record high of £256,000, the ONS said that the figures for March showed the highest annual growth since August 2007. In the twelve months between March 2020 and March 2021, the average house price went up £24,000.

Much of the industry commentary on the figures centred on the resilience of the housing market, which largely froze a year ago with the coronavirus pandemic.

Cloe Atkinson, managing director of Mortgage Engine, said: “2021 has so far proven a stellar year for house price growth. The busy start to this year reflects the success of various government measures to stimulate demand in the market, as well as the hard work carried out by the property industry to overcome the challenges of the pandemic and adapt to new ways of doing business. There has been an extraordinary amount of change in a relatively short time.”

Others said the cause for the continuing buoyancy of the UK’s housing market was due to the Stamp Duty holiday that was extended but is due to be phased out over the rest of the year.

Mark Harris, chief executive of SPF Private Clients said: “March should have been the month when the stamp duty holiday came to an end and the housing market mini boom started to fizzle out but prices continued to surge. With the holiday now extended, and lockdown restrictions continuing to ease, buyers have been given another opportunity to take advantage of the saving.”

House price rises were not uniform across the country. While the average prices were still highest in London, it was in the north-east, in Yorkshire and the Humber, that the fastest-rising values were seen. Homes in those areas saw a 14 per cent increase between March 2020 and March 2021.

Some expressed some reservation over the continuing bullish tone of the market. Gareth Lewis, commercial director of MT Finance, said: “with property prices continuing to increase, those trying to get on the ladder are going to struggle. Has the Bank of Mum and Dad taken a dent through Covid and will there be less money available to help fund deposits? 95% mortgages are more widely available but still very limited in terms of restrictions. We need the next generation of homeowners not only to want to buy but be able to and the government has responsibility to make property more affordable, in some way, shape or form.”

This post has originally been featured in Property Wire.