United Kingdom

House prices soar to 30% higher than their peak value before financial crash of 2007 

House prices are almost a third higher than at their peak before the financial crisis.

A typical home cost £177,300 in December 2007 before plunging by 20 per cent. 

However the average is now around £230,700 according to Zoopla – an increase of 30 per cent.

Almost £12,000 of the £53,400 rise was added in the past year as families started a ‘race for space’ following the first coronavirus lockdown.

That has seen buyers hunt for bigger properties with gardens and home offices, with demand also turbocharged by the stamp duty holiday.

Grainne Gilmore, Zoopla’s head of research, said: ‘Demand is moderating from record high levels earlier in the year, but remains significantly up from typical levels.  

'There is a continued drumbeat of demand for more space.’

A general shortage of homes is helping to push up prices, with a 25 per cent fewer homes on sale in the first half of this year compared to 2020.

This is partly because some homeowners are reluctant to put their homes on the market, seeing no properties they themselves would like to buy, according to the firm’s report.

The average home is now around £230,700 according to Zoopla – an increase of 30 per cent since 2007

Despite the huge price rises across much of the UK, London has been lagging behind with annual price growth of just 2.3 per cent and a highly ‘polarised’ market

Despite the huge price rises across much of the UK, London has been lagging behind with annual price growth of just 2.3 per cent and a highly ‘polarised’ market.

Prices are rising by up to 6 per cent in the outer boroughs but falling by as much as 2 per cent in central areas such as Westminster and Kensington & Chelsea, Zoopla said.

Miss Gilmore said there was a ‘two-speed market’ could be down to international travel restrictions preventing foreign buyers from snapping up the most valuable properties as easily.

Zoopa said it expected the housing market to continue to be supported for now by supply shortages, more affordable mortgages and the remaining stamp duty savings on offer until the end of September.

The holiday which ran from July last year to the end of last month meant buyers paid no stamp duty on homes worth £500,000 or less.

From July 1, the no-tax threshold has been tapered down to £250,000 before it returns to the normal level of £125,000 from October 1.

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