The value of the average home may soon reach £300,000 in Britain, following an average price increase of £18,000 in 2015, agents have forecasted.
The average house in England and Wales grew by 6.6 per cent over the course of 2015, up by £17,963 against the previous year to reach £292,077, according to the latest research from estate agents Reeds Rains and Your Move.
December saw the highest year-on year house price growth for ten months, after prices rose 0.6 per cent up to £1,650.
For Adrian Gill, director of Reeds Rains and Your Move, the sinking supply of housing and increasing demand has been a major factor in pushing prices upwards.
“The rising tide of property prices has been propelled so far by a sinking supply of houses coming onto the market, compared with increasing enquiries from potential buyers eager to clamber aboard the property ladder,” he said.
He predicted that if the current speed of house price growth continues in 2015, the value of an average property could reach the £300,000 watermark after hitting £250,000 in December 2013.
But property values have not grown across the country with prices falling in London’s five most expensive boroughs by nearly 9 per cent on average during 2015, dragged down by higher Stamp Duty.
Prices fell by 14.2 per cent over the year in Kensington and Chelsea.
The South East has been enjoying the fastest growth of any region with a growth of 8.1 per cent, propelled by demand from London commuters.
The East Midlands follows with a significant surge in house prices, overtaking East Anglia to become the second fastest growing region in England.
According to another report by the Halifax, the UK’s biggest lender, house prices rose by nearly 10 per cent in 2015 compared to a year earlier. The “substantial” gap between supply and demand pushed the average house cost to £208,286, Halifax said.
Last week, Prime Minister David Cameron announced plans for a new £1.2 billion fund to pay for 30,000 “affordable” starter homes in an effort to bring down the cost of home ownership for first-time buyers and address the housing shortfall.