Despite being the most delayed measure of house price growth, the figures from ONS are the most accurate and have shown that on a seasonally adjusted basis, average UK house prices saw a rise of 0.7% between December and January and was up 9.6% over the year to January 2022. The average house price reached £274,000 in January, £24,000 higher than the same time last year.
Regionally, Wales saw the biggest increase over the year, rising 13.9% to £206,000, followed by Scotland on 10.8%, England 9.4%, and finally Northern Ireland to £159,000 (7.9%).
London continues to be the region with the lowest annual growth at 2.2%.
Mark Harris, chief executive of mortgage broker SPF Private Clients, says: "The bigger than expected jump in inflation, taking it to its highest level in 30 years, and with more to come, will be preying on the Chancellor’s mind when he stands up to deliver his Spring Statement this afternoon.
"The housing market continues to perform strongly with house prices continuing to rise, due to lack of stock. Those buyers who didn’t make their move last year are still keen to do so, assuming they can find the right property and take advantage of mortgage rates while they remain low."
Jeremy Leaf, north London estate agent and a former RICS residential chairman, says: "Another day, another survey showing the resilience of the housing market despite concerns about implications of the war in Ukraine, particularly on inflation and interest rates.
"On the ground, existing homeowners whose purchasing power has been buoyed by savings and equity, still remain keen to find homes which fit their post-Covid lifestyle.
"Affordability is more of a factor for those buying for the first time so will have some impact on prices."
Emma Cox, Managing Director of Real Estate at Shawbrook, said: “House prices continue to challenge any sense of normality despite rising inflation and the soaring cost of living forcing a reality check to buyers’ budgets. Record prices and undiminished demand is putting pressure on buyers that aren’t seeing their money go as far across the board.
“Yet, the outlook does remain positive for those looking to sell. The market remains firmly in favour of those with capital available and looking to add to portfolios or let out properties. Although recent hikes in energy bills and running costs will have to be factored in, socially responsible landlords will be aware of the changes they can make to their portfolios in order to limit the impact of energy price rises in the future for tenants.
“The market is in desperate need of a steady stream of high quality, affordable, housing to rebalance the market and help those struggling to purchase a property. This will help to steady house prices that currently see the sky as the limit. It is important that the government continues to focus on delivering its Levelling Up Agenda. This will benefit our local communities, making the path to homeownership possible and improving living standards. By restoring a sense of community and spreading opportunities in the regions, this will create more demand for rental properties from landlords across the board.”
Tomer Aboody, director of property lender MT Finance, says: "To see why house prices continue to perform so strongly, even while interest rates are rising, you need to look at sales volumes, with half the number of transactions taking place in November 2021 compared with the same month the previous year. This dramatic fall in transactions illustrates why prices continue to rise – lack of supply, combined with high demand is going to push values up to record levels until something changes.
"The government needs to do something with stamp duty to incentivise downsizers to release family homes onto the market in order to increase the number of transactions, helping keep price increases in check.
"It is not surprising to see Wales continuing to have record increases in prices as the numbers are starting from a lower base. Any increase in prices is going to be more dramatic than cities such as London where the rise in values is still relatively high but not as much as in the regions."
