UK average house prices increased by 10.8% in 2021, according to figures from the Office for National Statistics.

The average UK house price was £275,000 in December 2021, £27,000 higher than a year earlier.

Average house prices increased over the year in England to £293,000 (10.7%), in Wales to £205,000 (13.0%), in Scotland to £180,000 (11.2%), and in Northern Ireland to £159,000 (10.7%).

Alan Fitzpatrick, spokesperson for mortgage firm Habito, said: “This ONS data reflects the year of the Stamp Duty Holiday – from the first deadline in March, the extended deadline in June, and the lower threshold which was payable until the end of September. To put this incredible one-year price rise into more context, £27,000 would be the 2022 take-home salary post-tax, of someone earning £35,000 (more than the UK average full-time salary which is £31,285).

“But this rise in house prices is highly unlikely to be repeated again this year. Since this ONS House Price data was collected in December 2021, we’ve seen two base rate rises in two months from the Bank of England as they try to get a firmer grip on inflation. Base rate rises lead to more expensive mortgage rates, which should lower the demand for home buying and have a cooling impact on house prices.”

Paul Stockwell, chief commercial officer at Gatehouse Bank, added: “Persistent strong demand to move home coupled with low supply meant house prices soared again at the end of last year, but the housing market is beginning to look out of place with what is happening in the wider economy.

“Buyers continue to bid up the price of homes despite the cost of living squeeze, and there remains a strong pipeline of future borrowing, with mortgage approval rates recorded by the Bank of England last December still surpassing pre-pandemic norms.

“It’s a sign that buyers have a lot of faith in the resilience of the property market, and believe housing continues to offer a great deal of financial security, even at a time of wider economic uncertainty.”