Official figures show the average property price hit £275,000 at the end of December following a 10.8% rise over the year.
New statistics provide hard evidence that 2021 was indeed a bumper year for the property market with the stamp duty holiday, race for space and low interest rates whipping up a whirlwind of activity which has inflated house prices to record levels.
The data from the Office for National Statistics (ONS) show house prices in England grew by 10.7% to stand at an average of £293,000. Wales saw the biggest hike with average prices soaring by 13% to £205,000 and in Scotland house price inflation was 11.2% to boost the average up to £180,000 (11.2%). In Northern Ireland property prices rose by 10.7% to £159,000.
Meanwhile, London remained the region with the lowest annual growth – prices in the capital inflated by 5.5% over the year, according to the ONS data.
Clare Beardmore, head of broker and propositions at Legal & General Mortgage Club, explained why the demand for property had remained so high, even following the end of the Stamp Duty Holiday in September.
“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,” she said.
“Of course, price growth remains underpinned by a chronic lack of supply, creating a fiercely competitive market for house-hunters.”
And Clare expected a similar pattern to emerge in 2022. She said: “These themes are likely to continue to dominate the market in 2022. While tax rises and rising inflation have begun to squeeze households’ spending power, the market has shown over the last few years that it can remain resilient, even in the face of unexpected headwinds.
“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. Doing so could help them secure a deal that is well-aligned with their circumstances and safeguards their finances.”
