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UK house prices rose at the fastest pace in nearly 14 years in March after Rishi Sunak announced the extension of the stamp duty holiday.
Property prices increased 10.2% in the year to March 2021, up from 9.2% in February this year. This was the highest annual growth rate the UK has seen since August 2007, according to official figures.
Prices soared 1.8% in March alone, the highest increase in any month since April 2014.
The average British house price value now stands at a record £256,405 ($363,275), compared with £232,684 in the same time period in 2020.
"March was a record month that saw the highest transaction numbers in England ever recorded and the second highest monthly stamp duty tax take," said Nick Barnes, head of research at Chestertons. "Buyer motivation was driven by the stamp duty holiday deadline and the relaxation of lockdown restrictions."
This comes as the coronavirus pandemic prompted British households to re-evaluate their housing needs, meaning demand for family houses with gardens, parking and extra space to work from home rose.
Figures from the Office for National Statistics (ONS), citing Land Registry data, showed prices of detached houses rose 11.7% in the year to March, compared with an increase of 5% for flats and maisonettes.
Watch: What stamp duty cuts mean for buyers and house prices?
Jonathan Hopper, CEO of Garrington Property Finders said: "The boom isn’t just one for the history books. It’s also the product of a perfect storm of factors. Years of demand that had been repressed by Brexit uncertainty were unleashed just as the difficulties of lockdown living forced thousands of people to fundamentally reassess what they want from their home."
Regionally, London had the lowest annual growth (3.7%) for the fourth consecutive month. In comparison, prices in Yorkshire and the Humber region jumped by 14%.
At the country level, Wales recorded the largest annual house price growth in the year to March 2021, increasing by 11.0%.
This was followed by a 10.6% rise in Scotland, 10.2% in England. In Northern Ireland, house prices rose by 6.0% over the year to the first quarter (January to March) 2021.
It follows similar trends in other surveys, which have also shown the tax cut and the 95% mortgage guarantee scheme for first-time buyers further prompted a surge in activity in the housing market after the first COVID lockdown was lifted last year.
Separate figures reveal the average price of houses coming to market this month were up 1.8%, or £5,767, to £333,564, surpassing the previous all-time high recorded a month ago.
According to Rightmove’s (RMV.L) house price index, Wales led the way with a 13% rise, followed by the North West, which rose 11%, and Yorkshire and the Humber, which rose 10.5%. The average increase for all regions outside of the South of England was 9.7%.
The year-on-year comparisons looked at data in March 2020 and May 2021, as the property market was suspended for most of April and May last year.
Data from the Bank of England also showed mortgage borrowing in the UK hit £11.8bn in March, the strongest month since records began in 1993. The previous peak was in October 2006 at £10.4bn.
Meanwhile, figures released by housing website Zoopla at the end of April showed demand for UK property is up 27.5% year to date in 2021 when compared with average levels in 2020.
Watch: How much money do I need to buy a house?