Mortgage lenders competing to attract borrowers as house prices in London pass £500,000 for the first time
London’s average house price surpassed £500,000 for the first time in November 2020 according to data from The Office for National Statistics.
UK average house prices increased by 7.6% over the year to November 2020, up from 5.9% in October 2020, to stand at a record high of £250,000; this is the highest annual growth rate the UK has seen since June 2016.
Pent-up demand may have contributed towards an increase in house prices. The Bank of England's Money and Credit November 2020 release reported that mortgage approvals for house purchases (an indicator of future lending) increased further in November 2020 to 105,000, the highest since August 2007.
Average house prices increased over the year in England to £267,000 (7.6%), Wales to £180,000 (7.0%), Scotland to £166,000 (8.6%) and Northern Ireland to £143,000 (2.4%).
Aaron Strutt, product director at Trinity Financial, says: “Mortgages lenders are competing to attract borrowers again and there are more options available to first-time buyers. The rates are still incredibly cheap, and the lenders can provide mortgage offers quickly.
“Since lockdown started we have been arranging more mortgages for people moving out of the cities as they want more space, buyers are also keen to purchase second homes.”
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