House prices leap £4,000 in a MONTH: UK sees fastest annual rise in property values since 2017… despite our coronavirus pandemic woes
- Average cost of a home was £244,513 in September – £4,060 more than August
- Annual increase of 4.7 per cent – growing at fastest pace since October 2017
- Buoyed by a stamp duty holiday, the market is strong in every region of England
Property prices have hit the highest level on record after surging by £4,000 in a month.
The extraordinary rise in the face of coronavirus was revealed yesterday by the Office for National Statistics.
The average cost of a home was £244,513 in September – the latest month for which Land Registry figures are available. That was £4,060 more than in August – a one-month rise of 1.7 per cent.
The annual increase of 4.7 per cent – almost £1,000 a month – means prices are growing at the fastest pace since October 2017. Buoyed by a stamp duty holiday, the market is strong in every region of England – as well as in Scotland, Wales and Northern Ireland.
The average cost of a home was £244,513 in September – the latest month for which Land Registry figures are available
Detached properties are growing three times more quickly in value than flats – reflecting demand for more space in a time of lockdown.
The average price of a detached home rose by 6.2 per cent – or almost £22,000 – in the year to September. By comparison, the average flat or maisonette rose by 2 per cent – around £4,100 – to £211,443.
The ONS said price rises may have been driven by demand that built up during lockdown and ‘possible changes in housing preferences’.
Lucy Pendleton of estate agents James Pendleton said: ‘This was the moment the market really entered fifth gear this year, leaping from the doldrums into the jet stream with the full weight of lockdown and the stamp duty holiday behind it.’
Property prices have hit the highest level on record after surging by £4,000 in a month
Property experts have been taken aback by the strength of the recovery from spring, when the market was effectively put on hold by the pandemic.
House prices fell in April, the first full month of lockdown, when estate agents were banned from showing buyers around new homes.
But they have bounced back since the restrictions were lifted the following month. The ONS said September’s price rises were the first to be driven by the stamp duty holiday that started in England and Northern Ireland on July 8.
The levy has been removed on the value of property up to £500,000. Similar measures came into force on July 15 in Scotland and on July 27 in Wales.
House purchases typically take six to eight weeks to complete, meaning the impact has only just started to filter through to the official figures.
A stamp duty holiday on property sales in England and Northern Ireland was introduced by Chancellor Rishi Sunak in July
Experts said there were signs the market was starting to stall, with the second national lockdown paralysing vast swathes of the economy.
But Andrew Montlake of mortgage broker Coreco said: ‘News of a vaccine that few expected so early could transform the trajectory of the property market during 2021.
‘There will still be increased unemployment given the impact of the pandemic on the economy but a vaccine could see sentiment keep its head above the surface, which for the property market is key.’
Chancellor Rishi Sunak is also coming under pressure to extend the stamp duty holiday beyond March 31 amid fears that delays caused by the rush of purchases mean around 325,000 buyers could miss out.
Jeremy Leaf, a London estate agent, said the report underlined ‘what we were seeing at the tail end of the aftermath of the first lockdown mini-boom’.
He added: ‘Since then, activity cooled and was replaced by a more cautious approach before the prospect of a Covid-19 vaccine reinvigorated the market.
‘The stamp duty concession has proved to be a particularly important contributory factor.’