UK house prices in June recorded a 13.2 per cent annual rise – 4.5 per cent up on May’s figures – with average house prices at £265,668, showed Office of National Statistics, ONS, data.
Detached houses experienced the highest annual price growth of 15.6 per cent bringing the average price to £410,054. Flats and maisonettes revealed the lowest growth of 8.4 per cent bringing the average price to £221,211.
EY ITEM Club senior economic advisor Martin Beck said: “Better-off, home-owning households are emerging from the pandemic in relatively good financial shape. Taken together with changing housing preferences, very low mortgage rates and a strong economic recovery, it suggests a correction in property prices is unlikely in the near future.”
New build properties showed a 14.4 per cent annual price growth with the average price standing at £337,377 compared to resold properties which revealed a 9.1 per cent with the average price at £246,310.
Owner-occupier purchasers showed an annual 13.9 per cent growth bringing the average price paid to £309,754. First-time buyers recorded a slightly lower annual growth of 12.7 per cent with the average price paid at £222,712.
Sales transactions more than treble in June
The Northwest recorded the strongest annual growth at 18.6 per cent while London showed the weakest growth at 6.3 per cent. Wales showed the strongest growth at 16.7 per cent while Northern Ireland recorded the lowest growth at nine per cent for the year leading to the second quarter.
Estimated sales transactions in the UK were at 198,240 revealing a 219 per cent annual increase as buyers raced to beat the end of the stamp duty holiday. Between May and June, UK transactions rose by 74.1 per cent. Bank of England data showed a slight decrease in the mortgage approvals of 81,300 compared with April’s 86,900 figure. However, net mortgage borrowing reached a record high of £1.7bn in June.
Brokers Hank Zarihs Associates said the figures showed why development finance lenders were keen to offer property construction finance to SME builders for new residential projects.
The UK’s second-largest mortgage lender Nationwide Building Society reported similar annual house price growth of 13.4 per cent in June – the highest level since November 2004. The lender’s figures in July fell back to an annual increase of 10.5 per cent.
Nationwide’s chief economist Robert Gardner said: “Underlying demand is likely to remain solid in the near term. Consumer confidence has rebounded in recent months while borrowing costs remain low. This, combined with a lack of supply on the market, suggests continued support for house prices.”
Although, he said the outlook was harder to predict towards the end of this year.