UK house prices have hit a record high of £235,000 as sales are agreed at their fastest pace for 5 years.
The average home in the UK has increased in value by £44 per day in the past 6 months alone.
This is up from £30 per day between July 2020 and January 2021.
Meanwhile, the time it takes to agree a sale on a home is now less than 30 days, according to our latest House Price Index report.
What’s happening to house prices?
House prices climbed by 6.1% in the last year – more than double the rate of annual house price growth seen in August 2020.
At a regional level, house prices rose the most in Wales at 9.8%, followed by Northern Ireland at 8.4% and north west England at 8%.
And in terms of cities, Liverpool continued to lead the way. House prices in the city jumped by 9.8%, followed by Manchester and Sheffield at 8.1% and 7.6% respectively.
At the other end of the scale, house price growth continued to lag the national average in London, with property prices edging ahead by just 2.2% in the last year.
The gap between house price growth in Wales and London was one of the widest seen in the past 3 years.
How busy is the housing market?
The pandemic-induced search for space continued to fuel house hunting, with buyer demand still 35% higher than the average for the past 5 years.
There was a noticeable uptick in the number of buyers in London, with demand rising by 14% during the past month as many return to office life.
Houses continue to be more popular than flats, with buyer interest in houses up 25% in the capital compared with 6% for flats.
Meanwhile, the fast-approaching deadline for the stamp duty holiday in England and Northern Ireland at the end of this month does not appear to have dampened buyers’ enthusiasm.
The housing market is moving at its fastest pace for 5 years.
The time between listing a property and agreeing a sale has consistently averaged less than 30 days each month since May. Normally, it takes 40 days at this time of year.
And the acute shortage of homes for sale continues, with levels 28% lower so far this year compared with the average for 2020.
What could this mean for you?
First-time buyers
Despite the shortage of homes for sale, there is some good news for people taking their first step onto the property ladder.
There’s evidence that some landlords are selling up. Some 8% of homes that are currently listed for sale have been previously rented, rising to 13% in London. That’s up from a UK-wide average of just 3% 2 years ago.
And this in turn could boost choice for first-time buyers, who are typically interested in buying the same types of homes as landlords.
Also, if you are happy to purchase a flat, you are not only likely to face less competition, but you could also be in a stronger position to negotiate on the price.
Even so, the market remains fast-moving. It pays to get all your ducks in a row before you start your property search, so that you will be in a position to move quickly when you see something you like.
Home-movers
People moving up the property ladder continue to face the challenge of being both a seller and a buyer.
The good news is that if you have a family home to put on the market, you are likely to be able to secure both a top price and a quick sale.
The downside is that you are also likely to face stiff competition from other potential buyers for your next home. Meanwhile, the shortage of homes for sale may mean you have limited choice.
If you need to coordinate the sale of your current home and buy your next one, speak to a local estate agent. They’ll give you a good sense of the pace of your local housing market and whether there are currently many properties up for sale that meet your criteria.
Depending on how quickly the market is moving, you may want to have an offer accepted on a home you like before listing your current one for sale.
What will happen in the housing market next?
The search for space among buyers still has further to run as people take stock of their homes and lifestyles.
However, buyer demand is likely to be dampened by the end of government support, such as the furlough scheme.
Plus, more challenging economic conditions are likely to have a ripple effect in the final 3 months of the year.
Gráinne Gilmore, head of research at Zoopla, said: “We expect the market to remain busy compared to historical norms, and for price growth to remain in firmly positive territory at the end of the year, although lower than current levels of +6.1%.
“Stock levels will start to rebuild in early 2022 as market activity returns to more normal levels.”
How could Zoopla help?
Thinking of selling? Use My Home to get an instant estimate of your property’s value, look back at your home’s sales history and see what properties sold for in your area, as well as track properties you're interested in.
Looking for your next home? Register with us to stay ahead of crowd by receiving alerts when a property that fits your criteria is listed for sale. Our advanced search tools will also give you an idea of what is currently on the market in your area and price range.
Whether you are thinking of buying or selling, get in touch with local estate agents for expert market advice.