Property Prices Rise at Their Fastest for Five Years

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The Office of National Statistics (ONS) released their property market analysis for the year to November 2020. Their fascinating findings confirm house prices rose at the fastest rate since 2016.
The ONS also included a statement alongside their statistics outlining how pandemic restrictions affected their data gathering. A reminder of the transient nature of this pandemic.

Ready, Set, Boom

The new average house price in the UK is £250,000. This is the highest ever recorded national average house price. This 7.6% increase is the highest rate of growth since June 2016 – an uptick from the year to October 2020 (5.9%).

Examination of the national figures reveals increases region by region: Scotland up by 8.6% and £166,000 average house price; England up by 7.6% and £267,000 average price (more about London in a minute); Wales up 7.0% and £180,000 average price; and Northern Ireland up 2.4% and £143,000 average price.

London’s property price skyrocketed by 9.7% (compared to a 4.6% increase the month prior), winning top-tier status with Yorkshire and the Humber for the fastest growth rate in the country.

Other encouraging statistics include two significant increases. London eclipsed the £500,000 average house price for the first time (November 2020). The North East is the final region to shake off the July 2007 downturn to record a new average house price of £140,000.

Conveyancers and Other Industry Experts Overloaded

Unsurprisingly, conveyancers and other industry experts are overloaded with cases as the end of March approaches. Hopeful homeowners are urged to review all costs before launching their property bid at this late stage.

Over-extending their financial reach and overlooking essential standard charges such as conveyancing costs need to be avoided. Buyers, lenders and conveyancers such as are working as cohesively as possible to meet demand.

What Goes Up – Property Market Experts Forecast the Future

Flourishing market conditions are projected to be temporary. Influencing factors include the conclusion of government initiatives such as the stamp duty holiday (March) and the furlough scheme (April), as well as unemployment figures and diminished pent-up demand.

These factors could smother growth by as much as 5% this year, advised Howard Archer, chief economic adviser to the EY Item Club. Wary projections from the Office for Budget Responsibility (the independent forecaster advising the Treasury) expect property prices to fall by 8% this year.

Closer to the high street, Chestertons, Zoopla and Knight Frank predict a slowdown and an annual increase of up to 1.5%. Zoopla forecast the backlog of properties stampeding to meet the March stamp duty deadline petering out until house prices are up 1% by year’s end. Rightmove are optimistic with their expected 4% increase. Savills is projecting property prices to plateau in 2021 and begin an upturn in 2022.

Balancing Circumstances

The property market demonstrates a buoyancy and resilience few predicted. Indeed, few predicted the cataclysmic cauldron of circumstances dominating 2020.