UK house prices rise 11.8% in year to September

interactive investor comments on the latest ONS UK house price index.

• UK average house prices increased by 11.8% over the year to September 2021, up from 10.2% in August.
• The average UK house price was at a record high of £270,000 in September 2021, which is £28,000 higher than this time last year.
• Average house prices increased over the year in England to £288,000 (11.5%), in Wales to £196,000 (15.4%), in Scotland to £180,000 (12.3%) and in Northern Ireland to £159,000 (10.7%).
• London continues to be the region with the lowest annual growth (2.8%) for the 10th consecutive month.

Myron Jobson, Personal Finance Campaigner, interactive investor, says: “House prices were on the up yet again in September, ahead of the end of the stamp duty holiday with old rates coming back into play from 1 October.

“The stamp duty holiday turbocharged the housing market, which almost ground to a halt during the periods of Covid-19 lockdown. The promise of a lower tax bill resulted in a surge in house prices, with consumers racing to complete purchases ahead of the stamp duty holiday deadline. While house price growth is likely to slow, demand still significantly outstrips supply in many regions – especially London.

“Bumper house prices compounded by the uptick in the cost of living, with inflation more than double the Bank of England’s 2% target, means it remains tricky for many prospective first-time buyers to save enough to get on to the property ladder.

“There is some respite in the form of low deposit mortgages and low mortgage rates. However, with a rise to interest rates appearing imminent, with strong job figures strengthening the case for policymakers to raise the base rates in December to curb inflation, mortgages rates are likely to creep up – they already are.”