UK house prices climb 10% in year to May – ONS

The average UK house price increased by 10.0% over the year to May, according to the latest UK House Price Index published by the Office for National Statistics (ONS).

This figure is up from the 9.6% growth recorded in April’s index.

On a monthly basis, the figures from the ONS revealed a a slight increase in house prices in the month to May to £255,000 – a figure that has nearly returned to the record UK average house price seen in March 2021 (£256,000).

Average house prices increased by 9.7% over the year in England to £271,000, by 13.3% in Wales to £184,000, by 12.1% in Scotland to £171,000, and by 6.0% in Northern Ireland to £149,000. The latest index confirmed that London continues to be the region with the lowest annual growth (5.2%) for the sixth consecutive month.

Commenting on the ONS data, Benham and Reeves director, Marc von Grundherr, said that the extension of the stamp duty holiday caused the market to rebound immediately from the decline in market performance seen as a result of the original deadline.

“t’s simply irresponsible to measure the health of the market based on a metric as erratic as the monthly rate of house price growth and anyone who seeks to do so would do well to retire their crystal ball to the cupboard from which it came,” von Grundherr commented.

“The real proof in the pudding is the extremely strong performance seen on an annual basis and one that continues to defy expectation despite fears the market could soon run out of steam.

“While London continues to trail the rest of the market in this respect, we’re beginning to see the cogs start to turn, driven by a return to the workplace and preemptive demand from foreign buyers in anticipation of a move later in the year. As a result, the London property market will continue to build momentum long after the carrot of a stamp duty reprieve has been removed.”

Barrows and Forrester managing director, James Forrester, added: “The property market continues to move forward at an alarming pace, powered by a full tank of buyer demand and a shortage of housing stock to satisfy this hunger for homeownership. While the end of the stamp duty holiday may well act as a slight bump in the road, it will take far more than a marginal decline in homebuyer sentiment to cause the wheels to fall off.”

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