The average UK house price is now £296,400
(Picture: Matt Writtle)The average cost of a London home jumped £34,000 in the year to October, according to the Office of National Statistics (ONS).
With an annual growth of 6.7 per cent — the lowest increase of all UK regions — the average London house price is now £541,700.
London is the only region in the UK to have seen a monthly drop in house prices, having recorded an average of £546,700 in September.
The region to have seen the highest annual growth is the North East, where house prices are now £168,400 on average.
House prices have steadily increased across the UK in recent months, taking the average to a record high of £296,400 in October after annual growth of 12.6 per cent — or £33,100.
The UK annual growth accelerated from a 9.9 per cent increase in September, which was partly due to stamp duty changes last year, the ONS said.
The average UK house price was £296,000 in October 2022.
— Office for National Statistics (ONS) (@ONS) December 14, 2022
This is £33,000 higher than the same period a year ago and little changed from last month.
➡ https://t.co/tJ1vw6uI2k pic.twitter.com/K3TiO26gcO
Average house prices in England, Scotland and Wales hit new record levels in October.
The typical house price in Scotland increased by 8.5 per cent over the year, to £194,900, while the average house price in Wales increased by 11.8 per cent over the year (£223,800).
In England, the typical property value jumped by 13.2 per cent annually to £316,100.
The average house price in Northern Ireland increased by 10.7 per cent over the year, reaching £176,100.
Aimee North, ONS head of housing market indices, said: “Annual house price inflation increased in October, although this was mainly because of the sharp fall in house prices at the same time last year following the end of the stamp duty holiday.
“London saw the lowest annual growth throughout the UK and was the only region to show a fall in average house prices between September and October 2022, while house prices in the North East saw the highest annual growth.
“Rental prices reported their strongest rise in six years, driven by increases in the London rental market. East Midlands reported the highest annual rise while Wales replaced London as the region with the lowest.”
Aimee North continued: (3/3)
— Office for National Statistics (ONS) (@ONS) December 14, 2022
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ONS figures showed that private rental prices paid by tenants rose by four per cent in the 12 months to November 2022, up from 3.8 per cent in the 12 months to October 2022, representing the largest annual percentage change since the records started in January 2016.
Annual private rental prices increased by 3.9 per cent in England, 3.1 per cent in Wales and 4.4 per cent in Scotland in the 12 months to November.
Private rental prices in London increased by 3.5 per cent in the 12 months to November — the strongest annual percentage change since April 2016.
The figures were released amid signs that sharp rises in living costs may have passed a peak.
The rate of Consumer Prices Index (CPI) inflation eased by more than expected, to 10.7 per cent in November, from 11.1 per cent in October.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “Inflation slipping to 10.7 per cent will start to ease pressure on the Bank of England but a half-point increase in base rate this month is still expected.
“That said, the pricing of fixed-rate mortgages continues to ease, with five-year fixes now dipping below 4.5 per cent.
“We believe they are heading towards four per cent as the cost of funds falls, servicing pressure subsides and lenders look to originate new business in the new year.”
A more adverse lending landscape is emerging after 13 years of ultra-low rates
Tom Bill, head of UK residential research at Knight Frank, said: “Despite today’s figures, double-digit UK house price growth is now a thing of the past.
“Even as the reverberations of the mini-budget fade, a more adverse lending landscape is emerging after 13 years of ultra-low rates.
“When the spring market gets under way next March, mortgage rates will be more than two percentage points higher than at the same point in 2022.
“This will keep transaction volumes in check and means price declines will become more prevalent. Knight Frank expects UK prices to fall by 10 per cent over the next two years, taking them back to where they were in summer 2021.
“We think London prices will continue to underperform the rest of the country, with the exception of prime central areas, which will benefit from a higher proportion of cash buyers.”
