Annual UK house price growth accelerated to 11.8% in September, a figure up from 10.2% in August, according to new data from the Office for National Statistics (ONS).

The latest UK House Price Index revealed the average UK house price was at a record high of £270,000 in September, a figure that is £28,000 higher than the same time last year.

According to the latest figures, average house prices on a non-seasonally adjusted basis in the UK increased by 2.5% between August and September. This compares with an increase of 1.1% during the same period in 2020.

Average house prices increased over the year by 11.5% in England to £288,000, 15.4% in Wales to £196,000, 12.3% in Scotland to £180,000, and 10.7% in Northern Ireland to £159,000. The ONS confirmed that London continues to be the region with the lowest annual growth (2.8%) for the tenth consecutive month.

Commenting on the data, Perenna COO and co-founder, Colin Bell, said: “Demand for homes remained strong throughout September, with buyers rushing to complete before the end of the stamp duty holiday. Together with an ongoing lack of housing supply, and now a potential rate rise on the cards, this has pushed up property prices. Many buyers will now be concerned that homeownership is getting further out of reach.  
 
“We need a new solution to ensure housing remains affordable for aspiring homeowners. Flexible, fixed-for-life mortgages could provide a meaningful alternative to the status quo. These mortgages give buyers the opportunity to borrow more to help them step onto the ladder because they offer the certainty that monthly repayments will not change over the lifetime of the loan.”

Trussle head of mortgages, Miles Robinson, added: “While the market remained buoyant because of the stamp duty holiday, the months ahead will likely be more difficult as buyers may start to view the market with caution. We have already seen the much publicised sub 1% mortgage deals begin to disappear, and a rise in interest rates is certainly on the cards. Alongside this, it looks set to be a difficult winter for household finances.

“Families are facing a steep rise in energy bills and an increase in the general cost of living. This squeeze in consumer spending will almost certainly impact people’s ability to save for deposits and ultimately move home. But, for those staying put, now could be a good time to remortgage, as rates remain competitive.”

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