Press Releases
Average UK House Prices Tops Over £250K as Inflation Reaches a New High
According to the latest figures released by Nationwide, the average home in the UK will now set buyers back more than a quarter of a million pounds. Data shows that prices have continued to increase, despite the end of the stamp duty holiday, with a monthly increase of 0.7% recorded in October of this year.
Over 2021, property prices have risen by 9.9% pushing the average house price to £250,311, with a total rise of around £30,000 since the onset of the pandemic. Nationwide’s chief economist Robert Gardner suggested this can be attributed to the high demand but lack of supply of affordable housing in the UK.
He stated, “Demand for homes has remained strong, despite the expiry of the stamp duty holiday at the end of September. Indeed, mortgage applications remained robust at 72,645 in September, more than 10% above the monthly average recorded in 2019.
“Combined with a lack of homes on the market, this helps to explain why price growth has remained robust.”
Drastic Rise in Interest Rates
This week there has speculation that the current interest rate of 0.1% is set to significantly increase, although Robert Gardner felt that such rises would be limited and would only cause a modest impact.
Lucy Pendleton, of James Pendleton Estate Agency, said the expected base rate rise is encouraging buyers to purchase homes.
“The market remains solid because there are still plenty of reasons to buy now rather than wait,” she commented.
“We may be a month on from the end of the stamp duty tax break, but a near-certain string of interest rate rises over the next 18 months is proving to be a far more powerful motivation to transact than the stamp duty holiday ever was.
“Concerns over rising inflation have eclipsed the handout as a key driver of demand and you don’t have to be a genius to figure out that locking in an attractive 10-year mortgage rate now may be the best financial decision you ever make.
“First-time buyers are particularly eager to do so. Having only ever known rock-bottom interest rates, there’s a little fear of the unknown incentivising them to act quickly now.”
By purchasing property now, buyers can take advantage of offers for mortgage deals that will prevent them being affected by the expected rate increase. Property owners are being encouraged to look at the terms and conditions of their current mortgage and consider whether switching to a fixed rate mortgage would be to their advantage.
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