Average UK house price 30 per cent up on 2007 market peak

The average price of a home in the UK has risen to a new high of £230,700, up 30 per cent on the 2007 market peak.

Since June of last year, the average price has risen by 5.4 per cent, more than double the year on year price growth recorded 12 months ago, when annual house price inflation was tracking at +2.2%.

Pricing is being supported by a shortage of homes in the country, with the volume of homes for sale in the first half of 2021 down 25 per cent on the same period in 2020.

Despite this, transaction levels show little sign of slowing. Sales agreed are running at a lofty 22 per cent ahead of where they were in 2020.

Across the country, the North East experienced the highest percentage growth (7.3 per cent), with Yorkshire and the Humber just trailing with 6.8 per cent.

London’s housing market growth has been trailing the rest of the country for eight months, and this shows no sign of abating.

Where the average growth across the country is 5.4 per cent, London is currently running at 2.3 per cent.

Demand in London is polarised between the suburbs and inner London, however. Demand in outer London is running some 86 per cent ahead of the 2017-19 average.

In contrast, demand in inner London is only running 2 per cent above the normal market average.

Grainne Gilmore, head of research at Zoopla, comments: “Demand is moderating from record high levels earlier in the year, but remains significantly up from typical levels, signalling that above average activity levels will continue in the coming months. 

“Demand for houses is still outstripping demand for flats. To a certain extent this trend will have been augmented by the stamp duty holiday, with bigger savings on offer for larger properties – typically houses.”

Chancellor Rishi Sunak had extended the stamp duty holiday until the end of June.

Gilmore went on to say of the inner London market specifically: “The lack of international business and leisure travel is affecting demand in the more global real estate markets towards the centre of London.

As Covid-19 progresses at different rates across the world, unrestricted travel may not resume for some time yet, but when it does, demand will start to pick up once more.”