Guild of Landlords House Price Digest – April 2021

House prices are up, and the property market is buoyant – but a third of agreed purchases fail to complete. 

This is the Guild house price digest for April 2021. 

Buyers changing their minds are blamed the most for pulling out of deals, responsible for one in six cancelled purchases in the first three months of the year. Failing to secure a mortgage offer stopped another one in four property sales, according to data from property buying firm Quick Move Now. 

Other reasons for pulling out included slow progress of the sale (13%), unsuccessful attempts to persuade the seller to drop the price after the sale was agreed upon (11%), and not proceeding after a survey (11%). 

The fall-through rate for Q1 2021 is higher than the unusually low level in the final quarter of 2020 but 11% lower than the year-on-year figure of 43%, says the property firm.

House prices soar 7.5% in a year

The UK house prices stalled slightly last month but are still rising, according to new data from the Office for National Statistics (ONS). 

Property values rose 7.5% in the 12 months to January, down from an 8% y-o-y increase in December. The average home price in England is now £267,562, while Wales produced even better figures – a 9.6% boost to take the average home value to £179,000. 

In a year, the price of an average home in England has increased by £17,000. Property prices increased the most in the North West, where landlords enjoyed a 12% surge in values, while homes in the East Midlands performed the worst, rising just 4.7% in value. 

The ONS explains a range of factors are impacting housing demand and prices:

  • Data from the Bank of England shows lenders have approved an average of 100,000 mortgages a month since October, which proves the demand is steady in the market
  • The COVID-19 pandemic may have influenced buyers looking for homes with outdoor space and room to work.
  • The stamp duty holiday has led to higher asking prices as sellers are aware their buyers have more cash to spend

English house prices by region – January 2021

House prices in the North West are growing fastest since January 2005, and 12% year-on-year are outpacing the rest of the country, says the ONS. Homes in London added 4.5% to their value and are still the most expensive in the UK, with an average price of £501,000. 

The lowest house prices are in the North East, with an average of £138,000. In December, values peaked at £139,960, finally beating the previous high of 3139,400 set in July 2007, but they have slipped back.

Find out more with the ONS full House Price Index for January 2021

Wealthy ex-pats drive London prime markets

A weak pound is stimulating the prime London market as wealthy foreign buyers target the capital’s most expensive properties, says a report from one of Britain’s leading estate agents. 

The e-surv Acadata House Price Index shows prices are rising the fastest in the South West, while the London market is treading water. A trend is developing for purchasing detached homes in the South West and North West. 

The report puts the price of an average UK home at £339,160 – an annual increase of 9.8%. Excluding London, the annual price rise was 12.5%.

“On an annual basis, this is the highest rate of increase for over six years,” said e-surv director Richard Sexton. 

“It is a clear statement about the resilience of the housing market and how well it has responded to the challenges of the pandemic and the fiscal remedies that have been administered in the last year. This level of sustained price growth underlines how well the property market continues to perform in comparison to other areas of the economy. 

“We should be cautious when it comes to London’s lower growth rate. The capital’s market is evolving but the weaker pound has stimulated activity in the more exclusive markets in London though this hasn’t made a notable impact on the index at this stage. London remains a safe-haven for many international buyers and their families. The weak pound helped transactions in ultra-high-net worth markets in the capital rise last year.”

e-Surv Acadata owns the estate agent brands Your Move, Reed Rains and mortgage broker Primis. 

Find out more with the e-surv Acadata House Price Index for March 2021

UK house price comparison data 2020-21

Key: A = Annual M = Monthly       

House Price Digest FAQ

The figures for average house prices and movements in property values can be confusing if you don’t know how to read the data. 

Here are some of the most asked questions about house price indices.

Why are the average property prices different in each report?

The reports use different data to draw conclusions and take the data from different periods. The Nationwide and Halifax indices are based on their customer data, which are much smaller samples than the national data analysed by the ONS. Acadata’s methodology includes analysis that no other index uses. Each organisation collects data over different periods – Nationwide and Halifax are for the year to September, while the ONS is to the end of July.

What is the average house price?

There’s no such thing as an average home; the figure is simply math calculated from the total value of all transactions in the sample divided by the number of homes changing hands.

Which house price index is the best?

They are all flawed because of the restricted data they are based on, but the one with the broadest sample comes from the ONS. However, the ONS data is usually the last to market and out of date by three months on publication.

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