Average UK house prices increased by 10.8% over the year to December 2021, up from 10.7% last November, according to the latest data published by the Office for National Statistics (ONS).
The average house price was £275,000 in December 2021, or £27,000 higher than this time last year.
Average house prices increased over the year in England to £293,000 (10.7%), in Wales to £205,000 (13.0%), in Scotland to £180,000 (11.2%), and in Northern Ireland to £159,000 (10.7%).
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But house prices edging on the higher side is “not a cause for concern,” said Conor Murphy, CEO of digital mortgage and protection platform Smartr365. “In fact, this is good news for existing homeowners and the broader market, as it is a reliable sign that demand is robust.”
Clare Beardmore of the Legal & General Mortgage Club added: “[It] comes at little surprise that demand for property continues to run high. The past two years have dramatically changed what people want from their homes and these new-found preferences are still supporting high levels of transaction activity.”
While London continues to be the region with the lowest annual house price growth at 5.5%, London’s average house prices remain the most expensive of any region in the UK, the ONS reported, reaching a record level of £521,000 in December 2021.
“Inflationary pressures continue to weigh heavy on individuals as the cost-of-living crisis takes hold,” CEO of digital rental marketplace Canopy Chris Hutchinson remarked. “While homeownership may have felt out of reach before, it could now feel a million miles away as many feel stuck in a cycle of renting spending a large chunk of their salary each month on rent.”
“These themes [of price growth and lack of supply] are likely to continue to dominate in 2022,” Beardmore said. “Although some lenders are starting to shift mortgage rates upwards, pricing remains competitive, and many borrowers would benefit from speaking to an adviser to weigh up their options.”