UK house prices surge 10.2% in strongest annual increase since 2007

Average house price rises to record £256,405, up £24,000 from March 2020

An aerial view of Sloane Square in London. London recorded the lowest annual growth for the fourth month in a row with prices rising just 3.7%. Getty Images

UK average house prices rose 10.2 per cent on the year to a record £256,405 ($363,747) in March, the highest annual growth rate in the UK since August 2007, as the country’s housing boom continued.

The average price of a home was £24,000 higher than it was in March 2020, according to the Office for National Statistics, with the price rise in March following February’s 9.2 per cent increase.

Sam Beckett, head of economic statistics at the ONS, said the surge in March was also the 11th consecutive monthly rise for the property sector.

“The average price of a house in the UK now stands at a record £256,000, which is £24,000 higher than this time last year,” she said.

“However, London continues to be the region with the lowest annual growth, for the fourth month running.”

Britain's property market has surged during the pandemic after the first Covid-19 lockdown created pent-up demand for homes, and Chancellor of the Exchequer Rishi Sunak's stamp duty break, unveiled in July, boosted activity even more.

A mortgage guarantee scheme for first-time buyers further stoked the sharp surge in housing market activity.

While Wales recorded the highest growth rate, with average house prices rising 11 per cent to £185,000, England secured the highest price, with prices increasing 10.2 per cent to an average £275,000.

Elsewhere, Scotland saw growth of 10.6 per cent to £167,000, and Northern Ireland saw average prices rise 6 per cent to £149,000.

London saw the lowest annual growth for the fourth month in a row, with prices rising 3.7 per cent, as more Britons sought larger houses outside the capital with gardens, better suited to working from home.

Prices of detached houses rose 11.7 per cent in the year to March, compared with an increase of 5 per cent for apartments, the ONS said.

The London market has also been hit by a lack of foreign investors due to the country's tight travel restrictions. Estate agents and developers told The National that Gulf demand for homes in the capital is surging, but buyers are reluctant to commit to a purchase until they can fly in and view properties in person.