House prices ‘are now 30% higher than their 2007 peak’ as buyers seek more space

House prices are now nearly a third (30%) higher on average than a previous market peak in 2007, analysis has found.

Stock shortages are helping to push up prices, with a 25% fall in the volume of homes for sale in the first half of the year compared to the same period in 2020, Zoopla said.

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Grainne Gilmore, head of research at Zoopla, said: “Demand for houses is still outstripping demand for flats.

“To a certain extent this trend will have been augmented by the stamp duty holiday, with bigger savings on offer for larger properties – typically houses.

“But underneath this, there is a continued drum-beat of demand for more space among buyers, both inside and outside, funnelling demand towards houses, resulting in stronger price growth for these properties.”

The average UK house price in June hit a record high of £230,700 but just months before the average UK house price was £177,300 in December.

Looking at different property types, the search for space has pushed up the average price of a house by 7.3% over the past year.

By contrast, demand for flats has failed to keep pace and, as a result, prices growth is lagging at 1.4%.