Average UK house price rose by more than £24,500 in 2021 says Halifax

House prices increased by more than £24,500 on average in 2021, marking the largest annual cash rise since 2003, according to an index.

The typical UK property value hit a new record high of £276,091 in December 2021, Halifax said.

Property prices hit new record highs eight times last year, according to its monthly index, despite the impacts of the coronavirus pandemic.

But house price growth is expected to slow considerably this year, the report added.

The average UK house price increased by 9.8% annually and by 1.1% month on month in December.

Russell Galley, managing director, Halifax, said: “UK house prices climbed again in December for the sixth month in a row, rising by 1.1%.

“The average price for a property now stands at £276,091, an increase of more than £24,500 compared to December 2020, marking the strongest year-on-year cash rise since March 2003.

“The housing market defied expectations in 2021, with quarterly growth reaching 3.5% in December, a level not seen since November 2006.

“In 2021 we saw the average house price reach new record highs on eight occasions, despite the UK being subject to lockdown for much of the first six months of the year.

“The lack of spending opportunities afforded to people while restrictions were in place helped boost household cash reserves.

“This factor, alongside the stamp duty holiday and the race for space as a result of home-working, will have encouraged buyers to bring forward home purchases that may have been planned for this year.

“The extension of the Government’s job and income support schemes also supported the labour market and may have given some households the confidence to proceed with purchases.

“A lack of available homes for sale, and historically low mortgage rates, have also helped drive annual house price inflation to 9.8%, its highest level since July 2007.

“Looking ahead, the prospect that interest rates may rise further this year to tackle rising inflation, and increasing pressures on household budgets, suggests house price growth will slow considerably.

“Our expectation is that house prices will maintain their current strong levels but that growth relative to the last two years will be at a slower pace.

“However, there are many variables which could push house prices either way, depending on how the pandemic continues to impact the economic environment.”

Looking at annual house price growth across the UK, Wales remained the strongest performer, recording annual house price inflation of 14.5% in December.

The rate of increase in Wales was slightly lower than a 14.8% rise recorded in November.

Northern Ireland was also one of the strongest performing parts of the UK, with house price growth at 10.6%.

House prices in Scotland increased by 9.7% year on year.

In England, the North West was the strongest region, with house prices up by 11.8%.

London remained the weakest performing area for annual house price inflation, with a 2.1% increase.

Here are average house prices across the UK in December 2021 followed by the annual increase, according to Halifax:

– East Midlands, £225,106, 9.1%

– Eastern England, £319,447, 8.1%

– London, £525,351, 2.1%

– North East, £159,694, 8.3%

– North West, £211,954, 11.8%

– Northern Ireland, £170,946, 10.6%

– Scotland, £192,988, 9.7%

– South East, £374,454, 8.1%

– South West, £287,774, 11.0%

– Wales, £205,579, 14.5%

– West Midlands, £234,263, 8.8%

– Yorkshire and the Humber, £192,210, 9.7%