UK House Price Index: December 2021
16th February 2022
UK average house prices increased by 10.8% over the year to December 2021, up from 10.7% in November 2021.
The average UK house price was £275,000 in December 2021, which is £27,000 higher than this time last year.
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%).
London continues to be the region with the lowest annual growth at 5.5%.
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1.Main points
UK average house prices increased by 10.8% over the year to December 2021, up from 10.7% in November 2021.
The average UK house price was £275,000 in December 2021, which is £27,000 higher than this time last year.
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%).
London continues to be the region with the lowest annual growth at 5.5%.
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2.UK house prices
UK average house prices increased by 10.8% over the year to December 2021
The latest house price data published on GOV.UK by HM Land Registry (HMLR) for December 2021 show that average house prices in the UK increased by 10.8% in the year to December 2021, up from 10.7% in the year to November 2021 (Figure 1).
Because of the impact of the coronavirus (COVID-19) pandemic on both the number and supply of housing transactions, we might see larger revisions to the published UK House Price Index (HPI) estimates than usual.
There may be increased volatility in this month's estimates, particularly at the lower geographical levels where transaction volumes are smaller. We are looking at options to improve this, including working with data suppliers.
In particular, HMLR has been increasing the level of automation in the way they process applications. As a result of this process, initial data numbers may be lower than pre-coronavirus pandemic transaction volumes; however, in the medium to long term, this will lead to higher volumes being processed.
The total number of processed transactions feeding into this month's release (including those from previous months, which are incorporated in line with our revisions policy) has increased compared with recent months. While this indicates an improvement in the quality of the UK HPI estimates going forward, it may also result in revisions to previous months that are higher than usual, because more transactions are now available in our calculations. Further information on this can be found in Section 7: Measuring the data.
Figure 1: December 2021 saw UK house price growth increase to 10.8%
Annual house price rates of change for all dwellings, UK, January 2006 to December 2021
2021 Dec2020 Jun2018 Dec2017 Jun2015 Dec2014 Jun2012 Dec2011 Jun2009 Dec2008 Jun2006 Dec-20-15-10-505101512-month percentage change
2016 Apr
● 12 month percentage change : 7.9
Source: HM Land Registry, Registers of Scotland, Land and Property Services Northern Ireland, Office for National Statistics - UK House Price Index
Notes:
Not seasonally adjusted.
The full UK House Price Index (HPI) release is available to download from HM Land Registry at GOV.UK.
Download this chartFigure 1: December 2021 saw UK house price growth increase to 10.8%
Image .csv .xls
The latter half of 2020 saw the UK's average house price growth accelerating. This trend continued into 2021; the UK average house price for December 2021 was £275,000, up from £272,000 in November 2021.
On 8 July 2020, changes to the tax paid on property purchases were announced with immediate effect in England and Northern Ireland. Similar changes came into effect slightly later in Scotland and Wales (15 July 2020 and 27 July 2020, respectively). In England and Northern Ireland, properties up to the value of £500,000 would incur no tax, while the thresholds for Scotland and Wales were £250,000. These changes in the tax paid on housing transactions may have allowed sellers to request higher prices as the buyers' overall costs were reduced.
On 3 March 2021, an extension to the Stamp Duty holiday in England and Northern Ireland was announced. This meant that the tax holiday was extended until 30 June 2021, after which the threshold decreased to £250,000 until 30 September 2021. From 1 October 2021, the Stamp Duty thresholds have reverted to what they were before 8 July 2020. The tax holiday for Scotland ended on 31 March 2021. The tax holiday for Wales ended on 30 June 2021.
As the tax breaks were originally due to conclude at the end of March 2021, it is likely that March's average house prices were slightly inflated as buyers rushed to ensure their house purchases were scheduled to complete ahead of this deadline. This effect was then further exaggerated in June 2021, in line with the holiday extension on taxes paid on property purchases in England, Wales and Northern Ireland. This could also be seen again in September 2021, when the last of the tax holidays came to an end in England. An increase in prices since then has resulted in a record average house price level in the UK of £275,000 in December 2021.
Monthly property transactions statistics published by HM Revenue and Customs (HMRC) show that the provisional seasonally adjusted estimate of UK residential transactions in December 2021 is 100,110. This is 20.0% lower than in December 2020 but 7.6% higher than in November 2021.
The average UK house price was £275,000 in December 2021; this is £27,000 higher than in December 2020.
On a non-seasonally adjusted basis, average house prices in the UK increased by 0.8% between November and December 2021; this is unchanged from the same period a year earlier (November and December 2020).
The average house price in Wales increased by 13.0% over the year to December 2021. This is up from an increase of 12.6% in November 2021, with the average house price in Wales now at a record level of £205,000.
The average house price in Scotland increased by 11.2% over the year to December 2021. This is down from an increase of 12.1% in the year to November 2021, with the average house price in Scotland now at £180,000.
The average house price in England increased by 10.7% over the year to December 2021. This is up from an increase of 10.5% in the year to November 2021, with the average house price in England now at a record level of £293,000.
The average house price in Northern Ireland increased by 10.7% over the year to Quarter 3 (July to Sept) 2021. Northern Ireland remains the cheapest UK country to purchase a property in, with the average house price at £159,000. It should be noted that data for Quarter 4 (Oct to Dec) are not yet available. Therefore, house prices for these months have been carried forward from Quarter 3, until the latest figures can be incorporated.
On a seasonally adjusted basis, average house prices in the UK increased by 0.9% between November and December 2021, following an increase of 2.0% in the previous month.
Note
The above extracts are from a report by the Office for National Statistics published on 16 February 2022.
To read he full report go to https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/housepriceindex/december2021
