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House prices 30% higher than 2007 peak

Written by: Samantha Partington
Average property prices now stand 30% above the 2007 market peak reaching £230,700, representing a 5.4% year-on-year rise in June.

Zoopla’s latest price index shows a 25% fall in the number of homes for sale in the first half of the year compared to H1 2020, underpinning the strong price inflation. The property portal says there is no sign of a demand and supply rebalance in the immediate future.

Sales agreed continue to run at pace with volumes 22% ahead of average levels in 2020.

Buyer demand dipped by 9% in the first half of July after the most generous phase of the stamp duty holiday came to an end on 30 June.

However, demand still remains up 80% compared to the average for this time of the year. Family homes are top of the list with demand up 114% compared to the normal conditions.

Northern Ireland and Wales have registered the highest growth of 8.6% and 8.4% respectively, the highest growth in either country.

At a regional level, house price growth is at its highest in the North West up 7.3% and Yorkshire & the Humber is up 6.8%. Meanwhile London trails with annual house price growth of 2.3%.

Nationwide price growth is expected to edge upwards to 6% in the coming months before easing back towards the end of the year.

Grainne Gilmore, head of research, Zoopla, said: “Demand for houses is still outstripping demand for flats. To a certain extent this trend will have been augmented by the stamp duty holiday, with bigger savings on offer for larger properties, typically houses.

“But underneath this there is a continued drumbeat of demand for more space among buyers, both inside and outside, funneling demand towards houses and resulting in stronger price growth for these properties.

“London has a two-speed market at present with domestic demand driving price growth in the outer boroughs, while the lack of international business and leisure travel is affecting demand in the more global real estate markets towards the centre of London. As Covid progresses at different rates across the world, unrestricted travel may not resume for some time yet, but when it does, demand will start to pick up once more.”

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