(Alliance News) - UK house prices notched another record high in May, property portal Rightmove said on Monday, as the sector continues its post-lockdown surge.
Rightmove noted that prices in London are muted, though northern areas have seen house prices surge.
UK house prices rose 1.8% monthly to an average of GBP333,564, a record high. Annually, prices are 6.7% higher.
"Last year's unexpected mini-boom is rolling on into 2021, with new price and market activity records again defying many predictions. Buyer affordability is increasingly stretched, but there's obviously some elasticity left to stretch a bit more as many buyers are squeezing their way into higher price bands. This high demand, with both willingness and ability to pay more, has pushed the average price of property coming to market to a new all-time high of a third of a million pounds," Rightmove Director of Property Data Tim Bannister commented.
Rightmove noted that during housing market upturns in the UK, it is often London that leads the way. That is not the case this time, however, as house price growth in London since last year is just 0.2%. To compare, both the North West of England and Yorkshire & the Humber have seen growth of 11%.
"In another twist, it is the regions of Britain further north that are leading the way, with some degree of catching up between average prices in London and the north. While the gap remains very large, with average prices in London still 2.9 times higher than those in the north, this ratio is now at its smallest since 2013," Bannister added.
"The pandemic has given a greater focus on the home, and in 2020 we saw a surge in southern coastal and rural areas. So far 2021 is proving to be the year of the northern mover, not only satisfying their pent-up housing needs, but in doing so also narrowing some of the huge price gap with London."
The government's stamp duty holiday was originally set to end in March. However, in March, Chancellor Rishi Sunak extended the stamp duty holiday from the end of that month until the end of June, and after this a new GBP250,000 threshold will apply until the end of September.
Mark Manning, managing director of Yorkshire-based estate agent Manning Stainton, said: "This surge in buyer activity combined with a relative shortage of new properties coming to market has had the inevitable effect of creating a significant surge in prices with buyers clamouring to get their hands on most listings that hit the market. We can see little sign of this abating and would predict that even with the end of the present stamp duty incentive that prices will continue to rise through the rest of this year and likely beyond."
By Eric Cunha; ericcunha@alliancenews.com
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