June saw the highest annual property price growth since February 2007, with an incredible 10.7% rise in house prices. Take away the London growth rate figures, and that figure rises even higher to a huge 13.9%.
The East of England and the North West have seen a dip in growth rates in the month of June, but only very slightly. It’s been over a year since any area of the UK saw a fall in house prices, in spite of the pandemic and its catastrophic effect on the UK economy.
June showed the North West to be ahead of the game, with property prices showing an annual increase of 17.3%. Data shows the North West has taken the lead in the tables for the last nine months. Areas that have shown the most growth are Greater Manchester (23%), Warrington (22%), and Merseyside (19%).
Over the previous seven months, the areas that have shown the lowest annual house price growth include Greater London and the East of England, with Greater London having the lowest growth of just 1.2%. House prices in London dropped a huge 7.4% in May when compared to the previous year. Prime central London areas have seen dramatic house price drops as buyer habits changed due to the pandemic, opting for larger properties outside the city. On a month-to-month basis, June saw a rise of just 0.8%, although an improvement from March to May’s negative rates.
Director Richard Sexton stated:
“Over the last twelve months, our index has shown the average price of a home sold in England and Wales has increased by some £32,500, or 10.7%. If we exclude London from this, then the figure is a very considerable 14%. Nevertheless, even including the capital, this is the highest annual rate since February 2005. It is now fourteen months since any of the areas in our index have recorded a fall in house prices, and this is while the UK economy has been under the severest pressure it has faced in living memory.
“Any slowing of price rises in the period of March to May because of the initial expected end of the stamp duty holiday has been short-lived. This is in part because of the extension of the holiday but also because of the more general optimism in the economy, which has seen many transactions that were previously postponed come back online.
“Mid-April, even before the stamp duty holiday ends, the government has introduced further fiscal support in the shape of its 95% loan-to-value mortgage guarantee scheme. This is giving continued support and confidence to borrowers and mortgage lenders, many of whom have re-introduced their own higher LTV lending to the market. This is good for the market and for home movers.
“This fiscal support, combined with the UK’s monetary policy of historically low-interest rates, continues to make home moves more affordable and has meant buyers can take advantage of cheaper borrowing and the savings they have made in lockdown to make their home moves.”