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The Average House Price In The UK Is Now Over £250,000

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The Average House Price In The UK Is Now Over £250,000

This may come as a shock to people looking to get on the property ladder; house prices surged by 8.2 per cent annually in April - meaning the average house price across the UK was £258,204, Halifax said.

This means property values have increased by 1.4 per cent month-on-month, due to the stamp duty holiday, but Halifax predicts that the pace of house growth will slow later in the year.

Russell Galley, managing director at Halifax, explained: "House prices in April eclipsed the record high set the month before (£254,604) as the market continue to maintain its recent momentum.

The stamp duty holiday has been extended until June (Credit: PA)
The stamp duty holiday has been extended until June (Credit: PA)
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"The average property is now worth £258,204, up 41 per cent month-on-month and 8.2 per cent annually, the highest annual growth rate in five years.

"In cash terms, almost £20,000 has been added to the value of the average home since the market had essentially come to a standstill in April 2020."

The average price for a house in April 2020 was £238,511.

Galley explained how the stamp duty holiday has continued to stimulate the house market. "The stamp duty holiday continues to add impetus to an extremely active market, magnifying the current shortage of available homes as buyers aim to take advantage of the government scheme," he said.

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Rishi Sunak announced that the stamp duty holiday would be extended to the end of June this year during his budget announcement in March.

The chancellor revealed it would be possible to buy a home with a five percent deposit, to make getting on the property ladder easier and more affordable for thousands. It also means that the government will offer lenders the guarantee to cover the remaining 95 per cent, should the buyer default on monthly mortgage payments.

The average house price across the UK in April was £258,204 (Credit: PA)
The average house price across the UK in April was £258,204 (Credit: PA)

Galley predicts that the effect of the stamp duty holiday will "fade gradually over the coming months" as it's "tapered out" by low stock levels and interest rates, as well as a continued demand which is "likely to continue to underpin prices in the market."

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"However, we do expect recent levels of activity to be sustained over the short-term as buyers continue to search for homes with more space and potentially better suited for their new working patterns," he adds.

"Savings built up over the months in lockdown have given some buyers even more cash to invest in their dream properties, while the new mortgage guarantee scheme may have eased deposit constraints for some prospective home buyers who previously thought their first step on the housing ladder was a few years away."

The stamp duty holiday applies in England and Northern Ireland. In April, a government-backed mortgage guarantee scheme was launched. Both the scheme and the extended stamp duty tax has resulted in several major lenders offering five per cent mortgage deals.

Galley said: "There is growing optimism in the long-term outlook of the UK economy as the vaccination programme continues at pace, yet we remain cautious about the medium-term prospects of the housing market.

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The stamp duty holiday applies in England and Northern Ireland (Credit: PA)
The stamp duty holiday applies in England and Northern Ireland (Credit: PA)

"As we said in March, the current levels of uncertainty and potential for higher unemployment as furlough support ends leads us to believe that house price growth will slow to the end of the year."

Tomer Aboody, director of property lender MT Finance, said: "A combination of market confidence, along with growing optimism thanks to the vaccine rollout, is likely to strengthen the economy in the short-term at least."

Jeremy Leaf, a north London estate agent and a former residential chairman of the Royal Institution of Chartered Surveyors (Rics) said: "These record figures reflect not just what's been happening to the property market in the past few months but add to growing confidence over the longer term sustainability of the recovery.

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"In particular, the increase in new potential buyers we have seen on the ground who have little chance of profiting from the stamp duty holiday which prompted so many earlier moves, as well as buyers using savings they have been able to accumulate during lockdown.

"Limited supply and faster vaccine rollout is driving activity and upward pressure on prices. Values may soften when tapering of the stamp duty begins and furlough ends but the pace is likely to slow rather than prices changing dramatically."

Featured Image Credit: PA

Topics: UK News, Life News, Home, Money, Life, Property

Gregory Robinson
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