The average UK property price hit a new record high of £272,992 in November, according to the latest Halifax House Price Index.

Prices saw a quarterly increase of 3.4% to leave quarterly house price inflation at its strongest level since late 2006.

Halifax also reported that November saw a 1.0% monthly jump to add £2,808 to the average house price, while also tipping the annual rate of inflation up to 8.2%.

This is the fifth straight month that average house prices have risen, with typical values up by almost £13,000 since June, and more than £20,000 since this time last year. November was also a significant month in Wales, where the average Welsh property price has now surpassed £200,000 for the first ever time.

The latest figures mean that since the onset of the pandemic in March 2020, when the UK first entered lockdown, house prices have risen by £33,816 – a figure equating to £1,691 per month.

Halifax managing director, Russell Galley, commented: “The performance of the market continues to be underpinned by a shortage of available properties, a strong labour market and keen competition amongst mortgage providers keeping rates close to historic lows.

“Those taking their first step onto the property ladder are also playing an important role in driving activity, with annual house price inflation for first-time buyers at 9.1% compared to 8.8% for home movers.

“We see this across different property types too, with double-digit annual price inflation for flats (+10.8%) over the last year compared to slower gains for detached properties (6.6%). This could suggest the ‘race for space’ is becoming less prominent than it was earlier in the pandemic, with industry data also showing the overall number of completed transactions has fallen back since the end of the stamp duty holiday.”

Galley added that the housing market can now anticipate “greater uncertainty than has been the case for quite some time”, with interest rates expected to rise to guard against further increases in inflation.

“Economic confidence may be also be dented by the emergence of the new Omicron virus variant, though it remains far too early to speculate on any long-term impact, given insufficient data at this stage, not to mention the resilience the housing market has already shown in challenging circumstances,” he said.

“Leaving aside the direct impact of a possible resurgence in the pandemic for now, we would not expect the current level of house price growth to be sustained next year given that house price to income ratios are already historically high, and household budgets are only likely to come under greater pressure in the coming months.”

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