UK average house price hits record high of £292,000, ONS figures show

House prices surged by 7.9% annually in January

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House prices surged by 7.9% annually in January to reach a new record high of £292,000 on average across the UK, official figures show.

Average property values stood at a record high of £306,000 in England, while the index compiled by the Office for National Statistics (ONS) also hit new peaks for London, the South East of England and the East of England.

A first-time buyer faces paying 7.7% more for a property than a year earlier, with the average price paid for a starter home standing at £222,000 in January 2016.

In London, the average price of a home now stands at £551,000, after leaping by 10.8% year-on-year. The average price of a property in the South East is now £374,000 while in the East it is £315,000. House prices in the South East have risen faster than in London over the last year, with annual growth of 11.7%.

The North East continues to be the English region with the lowest average house price, at £156,000.

The North East is the only English region where house prices are yet to surpass their previous peak reached before the economic downturn. In stark contrast, the index for London is now 53.4% higher than its pre-downturn peak, reached in 2008.

Across the UK, house prices edged up by 0.9% month-on-month in January.

The figures also show a sharp contrast between the pace of annual price growth in England, where property values have leapt by 8.6%, and that recorded by other UK nations.

In Wales, property values dipped annually by 0.3% to reach £174,000 on average, while in Scotland they increased by 0.1% to reach £195,000 typically and in Northern Ireland they increased by 0.8%, taking the average house price to £153,000.

Current house prices in Wales, Scotland and Northern Ireland all sit below previous records for these nations.

House prices in Northern Ireland still have some way to climb to reach their pre-downturn levels, with the index there still at 42.9% below its peak reached in August 2007.

The ONS said that if London and the South East of England were taken out of the figures, instead of UK house prices increasing by 7.9% annually, they would have seen an uplift of just 5.1%.

In recent months, there have been some signs of housing market activity being increased by buy-to-let landlords rushing to beat a stamp duty hike. From April 1, buy-to-let investors will pay three percentage points above current stamp duty rates when they buy a property.

Property website Rightmove said this week that the average asking price for a home has passed the £300,000 milestone across England and Wales for the first time.

Richard Snook, senior economist at PwC, said the ONS figures show a "mixed" performance across the UK, while the South continues to "power ahead".

He said: "The recent changes to stamp duty, whereby supplementary rates will be charged on purchases of additional homes, may be providing a small boost to the market, as people rush to complete transactions before the changes come into force in April this year."

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