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PwC comments on ONS November house price figures

19/01/22

UK house prices continue to rise strongly in November 2021, despite the end of the stamp duty holiday in September

Jamie Durham, economist at PwC UK, said:

"Data released this morning shows that the UK housing market remained buoyant in November, with prices up 10% on an annual basis despite the end of the stamp duty holiday in September.

"The continued strong rate of price growth across the country is driven by a number of factors, including a shift in preferences causing increased demand while supply has been constrained, the accumulation of consumer savings during lockdowns over the last 18 months, and relatively low borrowing costs. 

"The capital once again saw the slowest price growth of all regions, with prices up 5.1% compared to the year before. This is in part due to higher prices in London, with the average home now costing nearly £520,000, which limits affordability and so price growth.

"While there remains considerable uncertainty in the outlook for the market, we do expect prices to continue to rise in 2022 but at a slower rate seen in 2021 as conditions start to normalise

"Going into 2022, the most significant risk to the outlook is the ongoing pressure on the cost of living. Figures also produced this morning show inflation in December surged to the highest rate in 30 years. This may impact consumer confidence, and limit willingness to make major financial decisions like buying a home. The Bank of England may also move to increase interest rates over the coming weeks to try to control inflation, which could limit affordability and reduce demand."

 

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