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Property prices reach record levels

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The property market is expected to remain strong over the coming months due to the supply/demand imbalance
Property prices reach record levels

House prices have hit a record high of £230,700, said Zoopla.

That’s 30% higher than the market peak in 2007, before the credit crunch hit, said the property portal.

House price rises are being driven by a lack of homes for sale, with stock levels down 25% in the first half of the year compared to 2020.

But those that are on the market are being snapped up, with sales agreed up by 22% compared to last year’s average.

Demand is still running 80% above the seasonal average, despite a small dip last month.

Property hotspots

At a country level Northern Ireland and Wales have seen the highest growth of +8.6% and +8.4% respectively over the last year.

Regionally house price growth is at its highest in the North West (+7.3%) and Yorkshire & the Humber (+6.8%), while London trails with annual house price growth of +2.3%.

Price growth is expected to rise to 6% in the coming months before easing back towards the end of the year, said Zoopla, as the impact of the extended stamp duty holiday unwinds and the economic landscape becomes more challenging.

Grainne Gilmore, head of research at Zoopla, said: “Demand is moderating from record high levels earlier in the year, but remains significantly up from typical levels, signalling that above average activity levels will continue in the coming months.

“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, funnelling demand towards houses, resulting in stronger price growth for these properties.

“Overall buyer demand coupled with constrained supply signal that price growth will continue to rise in the coming months, peaking at around 6%, before falling back to between 4%-5% by the end of 2021.”

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