UK Markets open in 4 hrs 54 mins

UK house prices rise at fastest rate since 2014: ONS

Andy Bruce
·2-min read
FILE PHOTO: Construction workers build a new house in Aylesbury

By Andy Bruce

LONDON (Reuters) - British house prices rose at the fastest annual rate in more than six years in February, even before finance minister Rishi Sunak announced new measures that have further pumped up the housing market, data showed on Wednesday.

House prices jumped by 8.6% from February 2020, the strongest annual increase since October 2014 and accelerating from 8.0% in January, the Office for National Statistics said.

Still, in month-on-month terms house prices were flat in February, chiming with other gauges of the housing market that pointed to a slowdown before Sunak's March budget announcement.

Other surveys, more timely but less comprehensive than the official data, suggest the measures announced by Sunak have poured new fuel on the housing market's pandemic boom.

On March 3 Sunak extended his COVID-19 emergency cut to a property purchase tax, known as stamp duty, and announced a new mortgage subsidy scheme for first-time buyers who cannot afford large deposits.

"Initial survey evidence suggests that the budget measures have given the housing market renewed life," said Howard Archer, chief economic adviser to the EY ITEM Club consultancy.

He said prices would continue to rise in the near term.

During lockdowns to contain the COVID-19 pandemic, Britons rushed to buy larger houses with gardens in less urban locations.

The ONS said prices of detached houses rose by 9.1% in the year to February, compared with 6.7% for flats and maisonettes.

London saw the weakest gain in house prices among all of the United Kingdom's regions, with a 4.6% increase in the year to February. By contrast, prices in the north west of England surged by almost 12%.

(Reporting by Andy Bruce; Editing by William Schomberg and Gareth Jones)