The positive news for the UK housing market continues, with the latest figures showing that prices have reached their highest annual growth in more than five years.
In its House Price Index, Nationwide Building Society states that the average house price in the UK is £227,826 – an annual rise of 5.8 per cent and a 0.8 per cent increase when compared to September 2020*. The data also shows the market’s acceleration over the last quarter, with prices rising 3.5 per cent compared to the previous reporting period. October’s annual increase is the biggest rise recorded since January 2015.
Behavioural shifts accelerating the housing market
According to Nationwide, the key accelerator of the housing market has been the behavioural changes from buyers, created due to the ongoing impact of the Covid-19 pandemic.
Nationwide’s Chief Economist Robert Gardner commented on the figures: “Behavioural shifts appear to be boosting housing market activity as people reassess their housing needs and preferences. Indeed, our poll in September suggested that 10 per cent of those surveyed were in the process of moving as a result of the pandemic, with a further 18 per cent considering a move for the same reason.
“But many others are looking to improve their property rather than move, with around a third (35 per cent) considering enhancing their home as a result of the pandemic. Nearly half (47 per cent) of those wanted to add or maximise space.
“Interestingly, 41 per cent wanted to improve energy efficiency and reduce their carbon footprint – almost as many as those looking to add or maximise space – which may reflect increased public awareness of the climate crisis.”
Government incentives supporting a thriving market
Since the initial lockdown restrictions in the UK were relaxed in the summer, homebuyers across the UK have been able to take advantage of Government-backed initiatives to take their next move on the property ladder.
In England, Rishi Sunak’s “stamp duty holiday” has cut the fees associated with purchasing a home by increasing the threshold when tax is payable to £500,000, whilst in Scotland any property purchased for under the sum of £250,000 will not be subject to paying Land and Buildings Transaction Tax (LBTT).