The Office for National Statistics (ONS) has revealed that UK average house prices increased by 10.8% over the year to December 2021, up from 10.7% in November 2021.
The average UK house price was £275,000 in December, £27,000 higher than this time last year.
Average house prices increased over the year in England to £293,000 (10.7%), in Wales to £205,000 (13.0%), in Scotland to £180,000 (11.2%), and in Northern Ireland to £159,000 (10.7%).
London continues to be the region with the lowest annual growth at 5.5%.
Nicholas Finn, managing director of Garrington Property Finders, said: “This isn’t the beginning of the end of Britain’s pandemic-inspired property boom. On this evidence, it’s more like the end of the beginning.
“The pace of price growth even notched up at the end of 2021, taking the total increase in the value of the average UK home over the year to 10.8%.
“In ordinary times, such double-digit price inflation would be seen as incredible. But 18 months of relentlessly rising prices have normalised the exceptional. So much so that December’s figure almost looks modest compared to the gravity-defying 13.5% annual price growth recorded in June.
“Early signs from 2022 suggest the New Year is off to a similarly strong start. The RICS reports that new buyer enquiries increased in January, and on the property front line we’re seeing a steady flow of determined buyers coming into the market.
“Offices may be open once again but commuting patterns have changed for good. With many workers – and their employers – embracing hybrid working, the Great Relocation has some way to run yet.
“This may explain the huge popularity of desirable areas that were once deemed too far from London to be commutable, such as Southwest England – which saw average prices rise by a blockbuster 13.6% in 2021.
“Yet we are starting to see a reflex action in the big cities as astute buyers detect improving value. London is a case in point – prices rose in the capital by 5.5% across 2021, but much of this increase came in the final months of the year and business is very brisk now, as aspirational buyers take another look at some of the classically popular postcodes.
“After a year in which prices soared in many rural areas, some buyers have noticed that London’s best areas – while still expensive by national standards – are becoming relatively better value.”
