Beautiful Virgin Islands

Tuesday, Jul 15, 2025

Average UK house price exceeds £260,000 for first time

Average UK house price exceeds £260,000 for first time

Shortage of homes for sale in February pushes up house price growth for seventh straight month
A shortage of homes for sale last month sent house price growth spiralling for the seventh consecutive month to 12.6%, prompting concerns that property values are moving further out of reach of first-time buyers.

Prices of the average home increased by 1.7% in February to more than £260,000 for the first time, said the building society Nationwide, accelerating the pace of growth from 11.2% in January.

Analysts, who expected a smaller increase in prices last month, said the ending of Covid restrictions enforced because of the Omicron variant and the threat of several interest rate rises this year from the Bank of England also spurred buyers to secure homes ahead of the peak Easter buying period.

Stiff competition between lenders for mortgage business, which has driven the offers for fixed-rate mortgages lower in recent months, was another factor driving prices higher.

Nationwide said the increase pushed the average British house price to £260,230, after soaring by almost £30,000 over the past 12 months – the biggest annual increase in cash terms that its monthly index has recorded in more than 30 years of its existence.

The price of a typical home is about a fifth higher than it was in February 2020, shortly before the coronavirus lockdowns started in the UK, according to Nationwide. This equates to a cash increase of £44,140.

As house price growth has outpaced wage increases, and housing affordability has become stretched, the price of a typical home sits at about 6.7 times average earnings, up from a ratio of 5.8 in 2019, according to Nationwide.

Robert Gardner, Nationwide’s chief economist, said housing market activity had remained robust in recent months, with mortgage approvals continuing to run above pre-pandemic levels at the start of the year.

He said: “A combination of robust demand and limited stock of homes on the market has kept upward pressure on prices.

“The continued buoyancy of the housing market is a little surprising, given the mounting pressure on household budgets from rising inflation, which reached a 30-year high of 5.5% in January, and since borrowing costs have started to move up from all-time lows in recent months.

“The strength is particularly noteworthy since the squeeze on household incomes has led to a significant weakening of consumer confidence.”

Ross Boyd, the founder of the mortgage comparison platform Dashly.com, said: “First-time buyers are as keen as ever to get out of the rental market and on to the property ladder, as it’s usually cheaper to own if you can find the deposit.

“The major challenges facing the market right now are a scandalous lack of stock, interest rate rises and the surging cost of living.”

Martin Beck, the chief economic adviser to the EY Item Club, said most purchases were likely to be by households that had saved during the pandemic and were more immune from the rising cost of living when deciding to buy.

Some households might also anticipate that the conflict in Ukraine and the growing uncertainty about the economic outlook will restrain the Bank of England from increasing rates much above 1%.

“But overall, while the cost of mortgages may rise more slowly than had been expected, the outlook for the housing market is looking less buoyant,” he said.

Gardner said that if the labour market remained strong and inflation continued to rise towards 8%, as many analysts predicted, the Bank would have little choice but to raise rates this year.

“Assuming that labour market conditions remain strong, the Bank of England is likely to raise interest rates, which will exert a further drag on the market if this feeds through to mortgage rates.

“Housing affordability has already become more stretched, in part because house price growth has been outstripping earnings growth by a wide margin since the pandemic struck.”
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Ghislaine Maxwell Says She’s Ready to Testify Before Congress on Epstein’s Criminal Empire
Bal des Pompiers: A Celebration of Community and Firefighter Culture in France
FBI Chief Kash Patel Denies Resignation Speculations Amid Epstein List Controversy
Air India Pilot’s Mental Health Records Under Scrutiny
Google Secures Windsurf AI Coding Team in $2.4 Billion Licence Deal
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
South African Police Minister Suspended Amid Organised Crime Allegations
Nvidia CEO Claims Chinese Military Reluctance to Use US AI Technology
Hong Kong Advances Digital Asset Strategy to Address Economic Challenges
Australia Rules Out Pre‑commitment of Troops, Reinforces Defence Posture Amid US‑China Tensions
Martha Wells Says Humanity Still Far from True Artificial Intelligence
Nvidia Becomes World’s First Four‑Trillion‑Dollar Company Amid AI Boom
U.S. Resumes Deportations to Third Countries After Supreme Court Ruling
Excavation Begins at Site of Mass Grave for Children at Former Irish Institution
Iranian President Reportedly Injured During Israeli Strike on Secret Facility
EU Delays Retaliatory Tariffs Amid New U.S. Threats on Imports
Trump Defends Attorney General Pam Bondi Amid Epstein Memo Backlash
Renault Shares Drop as CEO Luca de Meo Announces Departure Amid Reports of Move to Kering
Senior Aides for King Charles and Prince Harry Hold Secret Peace Summit
Anti‑Semitism ‘Normalised’ in Middle‑Class Britain, Says Commission Co‑Chair
King Charles Meets David Beckham at Chelsea Flower Show
If the Department is Really About Justice: Ghislaine Maxwell Should Be Freed Now
NYC Candidate Zohran Mamdani’s ‘Antifada’ Remarks Spark National Debate on Political Language and Economic Policy
President Trump Visits Flood-Ravaged Texas, Praises Community Strength and First Responders
From Mystery to Meltdown, Crisis Within the Trump Administration: Epstein Files Ignite A Deepening Rift at the Highest Levels of Government Reveals Chaos, Leaks, and Growing MAGA Backlash
Trump Slams Putin Over War Death Toll, Teases Major Russia Announcement
Reparations argument crushed
Rainmaker CEO Says Cloud Seeding Paused Before Deadly Texas Floods
A 92-year-old woman, who felt she doesn't belong in a nursing home, escaped the death-camp by climbing a gate nearly 8 ft tall
French Journalist Acquitted in Controversial Case Involving Brigitte Macron
Elon Musk’s xAI Targets $200 Billion Valuation in New Fundraising Round
Kraft Heinz Considers Splitting Off Grocery Division Amid Strategic Review
Trump Proposes Supplying Arms to Ukraine Through NATO Allies
EU Proposes New Tax on Large Companies to Boost Budget
Trump Imposes 35% Tariffs on Canadian Imports Amid Trade Tensions
Junior Doctors in the UK Prepare for Five-Day Strike Over Pay Disputes
US Opens First Rare Earth Mine in Over 70 Years in Wyoming
Kurdistan Workers Party Takes Symbolic Step Towards Peace in Northern Iraq
Bitcoin Reaches New Milestone of $116,000
Biden’s Doctor Pleads the Fifth to Avoid Self-Incrimination on President’s Medical Fitness
Grok Chatbot Faces International Backlash for Antisemitic Content
Severe Heatwave Claims 2,300 Lives Across Europe
NVIDIA Achieves Historic Milestone as First Company Valued at $4 Trillion
Declining Beer Consumption Signals Cultural Shift in Germany
Linda Yaccarino Steps Down as CEO of X After Two Years
US Imposes New Tariffs on Brazilian Exports Amid Political Tensions
Azerbaijan and Armenia are on the brink of a historic peace deal.
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
BRICS Expands Membership with Indonesia and Ten New Partner Countries
×