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COVID-19 is no match for property market as house prices hit record high in March

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House prices hit a record high of £254,606 on average in March, jumping by 1.1% month-on-month, according to an index.

Across the UK, property values were 6.5% higher than in March 2020, Halifax said. This means the average price is around £15,000 higher than it was since the start of the national coronavirus lockdowns.

Russell Galley, managing director of Halifax, said: “Following a relatively subdued start to the year, the housing market enjoyed something of a resurgence during March, with prices up by just over 1% compared to February.”

The rise is the first since November last year, he said, attributing the buoyancy to government support measures such as the stamp duty holiday.

Mr Galley added: “Casting our minds back 12 months, few could have predicted quite how well the housing market would ride out the impact of the pandemic so far, let alone post growth of more than £1,000 per month on average.

“Overall we expect elevated levels of activity to be maintained in the coming months, with consumer confidence spurred on by the successful vaccine rollout, and buyer demand still fuelled by a desire for larger properties and more outdoor space, as work-life priorities have shifted during the pandemic.”

A shortage of home for sale is also likely to keep prices high, although the economy is yet to feel the full effect of its deepest recession in more than 300 years so the outlook remains cautious long-term, he said.

“Given current levels of uncertainty and the potential for higher unemployment, we still expect house price growth to slow somewhat by the end of this year.”

Mark Harris, chief executive of mortgage broker SPF Private Clients, said: “It is no surprise that the start of the year saw a more subdued market as lockdown and home schooling made viewings practically impossible.

“With hardly a day going by without another lender launching a high loan-to-value offering, and indeed rates coming down on these as more providers enter the fray, there is plenty on the lending front to tempt borrowers.”

Tomer Aboody, director of property lender MT Finance, said: “What we are seeing is a real lack of stock, which in turn increases competition and house prices.”

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COVID-19 is no match for property market as house prices hit record high in March