House prices rise in the North West of England.
House prices have risen sharply across the UK, driven by an increase of more than 15% in the year to May in the North West of England.
Official figures show property prices also rose at a rapid rate in Scotland, Wales and the North East of England.
The Office for National Statistics (ONS) said the average UK home cost £255,000 in May.
That was £23,000 more than the typical value a year earlier. The 10% rise was the fastest rate for 14 years.
Detached and terraced homes recorded the biggest price increases, data from the Land Registry in England and Wales show.
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Estate agents have reported huge demand from property buyers during the year so far.
This picked up when many buyers wanted to complete their purchases before stamp duty holidays were wound down. In May, the tax breaks were still in place for England, Northern Ireland, and Wales.
However, that is not the only explanation for rising prices. Scotland’s property tax break was withdrawn at the end of March.
People’s changing priorities as a result of the pandemic mean they are looking for bigger homes in which to live and work.
A lack of homes being put on the market to match demand has also led to rising prices. A majority of Royal Institution of Chartered Surveyors (RICS) members think prices will continue to rise over the next year for that reason.
Katie Cave, Director at mortgage broker Clearpoint Finance said:
“The market was being powered by ultra-low mortgage rates, valuable stamp duty savings and people rethinking what they want from their homes due to the pandemic. Demand was as rampant as supply was weak, which sent prices skywards.”
The ONS said that house prices in the UK rose by 10% in the year to May.
The North West was the region with the highest annual house price growth, with average prices increasing by 15.2%.
There were also big rises in Wales (up 13.3%), Scotland (up 12.1%) and the North East of England (up 11.8%).
At the other end of the scale, London recorded the slowest property price rise over the year, of 5.2%.
Ged McPartlin, Managing Director of Ascend Properties, said:
“It’s clear that the north-south divide has never been wider.
While this momentous rate of price growth must inevitably slow at some point, we expect this vast difference in property pedigree to remain as buyers in the north continue to benefit from a far more affordable market with, or without, the benefit of a stamp duty saving.”
In Wales, terraced houses rose in price by 15.2% over the same period.
That was the fastest rise of any property type, which was mirrored in England, where the value of terraced homes went up by 11.2%.
This was closely followed by a 14% rise in the cost of detached homes in Wales, and an 11% increase in England.
Properties with gardens have proved popular among buyers looking for space inside and outside homes.
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