Average house price hits new record high in March: Survey

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Average house price hits new record high in March: Survey

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 Average house price hits new record high in March: Survey

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Summary

  • Average house price in the UK has clocked a fresh record high in March 2021.
  • On a Y-o-Y basis, the average price of a property in the UK grew by 6.5 per cent.
  • Home sales in February increased to highest level since March 2007. 

The average house price in the United Kingdom has achieved a fresh record high in March 2021, continuing the yesteryear trend, a survey highlighted on Friday, 9 April. According to the House Price Index maintained by Halifax, the average price of a property in the UK has registered a new all-time high of  GBP 254,606, 1.1 per cent higher than what it was in February 2021.

A record high

On a year-on-year basis, the average price of a property in the UK grew by 6.5 per cent as compared to the price reflected in the Halifax House Price Index report of March 2020. This has been the first notable rise since November last year, except for a marginal increase in February on a sequential basis. A considerable part of the rise in average price of a property can be attributed to the increased demand for new homes after the Chancellor of the Exchequer Rishi Sunak unequivocally extended the stamp duty waiver on houses priced below GBP 500,000 in the Budget 2021.

In the January to March quarter of 2021, the average house prices remained 0.3 per cent higher as compared to the prevailing average rate of property in the last October-December quarter of 2020.

Earlier in March 2020, the standardised average price of a property in the UK stood at GBP 239,176. The average house price began to stabilise in the April-June quarter of 2020, reflecting the dull sales tone due to the first national lockdown, spike in coronavirus cases and certain operational difficulties in the sale of houses on the back of pandemic-induced restrictions.

As per the monthly property transactions data collated by the HM Revenue and Customs (HMRC), the home sales in the UK in February 2021 increased to their highest level since March 2007, the same year before the catastrophic effects of the subprime mortgage crisis began to emerge.

Transactions soar

Post-seasonal adjustments, the residential transactions rose 23 per cent to 147,050 in February from January 2021. Interestingly, the quarterly transactions up until February 2021 were 23.3 per cent higher than the preceding three months. The residential property related transactions in February 2021 were 56.2 per cent higher as compared to the transactions in the corresponding month a year earlier.

According to the Bank of England data, the mortgage approvals slipped for the third straight month in February with the mortgages approved to finance house purchase sliding down by 9.9 per cent to 87,669. However, the number close to 88,000 is nearly 19.5 per cent higher than the approvals received in February 2020.

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