House price growth rises to 10.9%: UK HPI

The average UK house price was £277,000 in February, which is £27,000 higher than this time last year.

Average house prices increased over the year by 10.7% in England, 14.2% in Wales, 11.7% in Scotland, and 7.9% in Northern Ireland.

The South West and East of England were the regions with the highest annual house price growth, with average prices increasing by 12.5% in the year to February. This was up from growth rates of 11.5% (South West) and 11.4% (East of England) in January.

The lowest annual house price growth was in London, where average prices increased by 8.1% over the year to February, up from 3.8% in January.

Despite being the region with the lowest annual growth, London’s average house prices remain the most expensive of any region in the UK, with an average price of £530,000.

Andrew Montlake, managing director of Coreco, commented: "Has the property market ever been so disconnected from economic reality? For prices to rise further in February should create more unease than it does celebration. Yes, the jobs market is strong but the latest inflation data coupled with stalling economic growth in February suggest the bull run will soon come to an end. Even then, though, average property values are unlikely to fall by much as mortgage rates are still very competitive and supply levels are ridiculously low. As it always does, the supply and demand imbalance will support average property values moving forward, even as we enter a potentially significant economic storm."

Mark Harris, managing director of SPF Private Clients, said: "The ready availability of cheap finance is one of the contributing factors to higher house prices.

"Lenders remain keen to lend, with borrowers opting for longer-term fixes in order to counter the considerable uncertainty in the world.

"While changes are being consulted on to relax some affordability criteria and allow certain buyers to borrow more, a return to irresponsible lending is unlikely given there would still be barriers in place."

Jeremy Leaf, north London estate agent and former RICS chairman, added: "These numbers show house prices continuing on their apparently inexorable upward path but that’s not quite what’s happening on the ground now.

"Demand is still well ahead of supply but concerns about the rising cost of living, squeezed pay packets and potentially further interest rate rises, are reducing price growth and transaction numbers.

"Looking forward, we expect activity to return to more ‘normal’ pre-pandemic conditions as supply picks up as part of the usual spring bounce."