UK house prices enjoy record year, Nationwide says

The average UK house price surged 10.4% in 2021, the largest increase in a single calendar year on record, according to the Nationwide Building Society index.

Average prices hit a year-high of £254,822 this month, marking a £23,902 rise on the last year, while they were 1.0% higher month on month for December.

“Prices are now 16% higher than before the pandemic struck in early 2020,” said Nationwide chief economist Robert Gardner.

He outlined strong demand for homes, despite the culmination of the stamp duty holiday in September, along with a very limited supply of houses on the market as drivers behind the price growth.

Additionally, “mortgage approvals for house purchases have continued to run above pre-pandemic levels, [while] in the first 11 months of 2021 the total number of property transactions was almost 30% higher than over the same period of 2019,” added Gardner.

For the first time since records began in 1973, Wales ended the year as the strongest performer in house value growth, with house prices some 15.8% higher on average.

Meanwhile, Northern Ireland saw its largest jump since 2007 at 12.1%, Gardner added.

Annual house price growth was 10.1% in Scotland, compared with 9.0% in England.

London experienced the lowest change of 4.2%, despite the average price rising to £507,230 – the highest regional average in Britain.

“The South West was the strongest performing English region, with annual price growth of 11.5%, the largest calendar-year increase in the region since 2004,” said Gardner.