Taunton is UK's top house price hotspot, according to new data from Halifax

Average London property prices have fallen by more than £3,500 this year, new analysis has revealed.  

The capital, which is usually among the top locations for property price rises, ranked bottom of regional growth figures for 2021.  

Average property prices in Greater London fell by 0.6 per cent to £554,684 across this year, according to figures released by Halifax today.

That makes London the only region in the country to see a decline in house prices and well below the UK average of a 6.2 per cent rise.

Home owners in wealthy boroughs such as Westminster, where average property prices fell by an eye-watering £54,000, were the biggest losers of 2021 according to Halifax.

Wales, meanwhile, was the biggest winner, with average property prices rising by £28,000, a staggering 14 per cent, across 2021.

And in terms of individual towns, Taunton in Somerset was the top house price hotspot, with average house prices rising by £56,546 – more than a fifth – this year.

It comes as other figures today revealed how the price of an average UK home hit a record high of £254,822 in December, up nearly £24,000 over the year.

Experts say the figures, which come as people across the country have once again been told to work from home due to the spread Covid, reflect a ‘race for space’ as Britons shift their demands away from big cities and ‘towards suburbs and further afield’. 

Russell Galley, managing director, Halifax, said: ‘As the county town of Somerset, this year’s house price winner, Taunton, has a lot to offer home-buyers with its high quality of life and great transport links to major towns and cities across the South West.

‘Like Taunton, many of the areas that saw the biggest house price growth over the last year enjoy a combination of greater affordability and space compared to nearby cities. 

‘Places like Bolton, Newark, Bradford and Hamilton – where there are a broad range of property types and settings – all offer significantly better value than their more metropolitan neighbours.’

Mr Galley added: ‘This is perhaps most clearly shown in the UK’s capital. It is rare that no London boroughs appear amongst the areas of highest house price growth but that is the case in 2021.

‘This shift echoes what we have seen from home-buyers over the last year – less focus on major cities and more demand in the suburbs and further afield.’

According to the figures, Taunton, Somerset’s county town which is famous for its cider and is home to a race course and cricket ground, saw average house prices soar by more than a fifth (21 per cent) this year.

Average property prices in the town, which is surrounded attractive countryside including the Quantock Hills, rose by £56,546 to £315,759.

It beat the Nottinghamshire market town of Newark (up 20 per cent), where average property prices rose by £46,732 to £280,934, and Rochdale (up 18.5 per cent), Greater Manchester, which saw a rise of £32,123 to £206,098.

The Wiltshire town of Chippenham, up 18.1 per cent to £381,181, and the Essex commuter town of Braintree, up 18 per cent to £381,181, rounded off the top five.

But while it was good news for market towns and commuter areas, it was bad news for London.

Greater London (down 0.6 per cent) was the only region to see a decline, with average property prices falling by £3,588 to £558,272 in 2021.

Three of the capital’s boroughs featured in the top five places where average property prices had decreased in 2021, according to Halifax.

According to the bank, average property prices in the wealthy borough of Westminster, home to some of the country’s top earners, dropped by 6.9 per cent this year – an average loss in value of around £57,809.

Hammersmith and Fulham, down 3.3 per cent to £716,541, and the trendy borough of Islington, down 1.6 per cent to £716,554, also featured in the bottom five.

However separate figures show how, having dipped earlier in the year, property prices in the capital bounced back in Autumn.

The average cost of a home in the capital rose 1.9 per cent in October, according to data from the Land Registry. 

Across England as a whole prices dipped 1.5 per cent in October, making London one of the strongest property markets in the country. 

Outside of London, Airdrie (down 3.8 per cent), saw average property prices fall by around £6,000, and Coatbridge (down 2.3 per cent), also in Scotland, where there was an average drop of around £3,435.  

While south-west market towns such as Taunton and Chippenham topped the list, areas in the Midlands and the North West also saw a property price boost.

The industrial town of Widnes, in Cheshire, saw an increase of 17.8 per cent, with average property prices rising by £33,628 to £222,876 this year. 

Bolton, in Greater Manchester, also known for its industrial roots, saw a large property price rise of 16.9 per cent, with average prices rising by £30,818.   

Other towns to feature in the top 20 include Devon’s Newton Abbot (up 14.8 per cent), Swansea (up 15.5 percent), in Wales and Maidstone (up 14.8 per cent), in Kent.

Surprise cold spots meanwhile saw some usually desirable locations fall well below the average UK property price rise of 6.2 per cent.

These include upmarket Oxford (up by 1.2 per cent), which saw average property prices rise by just £5,808 this year, and its rival university city of Cambridge (up 1.8 per cent), where average property prices increased by £8,600.

Commuter areas such as Croydon (up 1.5 per cent), London, saw average property prices rise by £6,502 to £436,441 this year, as did nearby Sutton (up 4.2 per cent) which saw a rise of £19,529 to £481,265.

This was also reflected in the regional data, with Wales (up 14 per cent) topping the list. Average property prices rose by £28,454 to £231,134.

Yorkshire and Humberside (up 10.3 per cent) finished second, with average prices rising by around £21,000, followed by the East Midlands (10.1 per cent), where there was a rise of £24,375. 

The South East (up 2.9 per cent) and the North (up 5.9 per cent) had the smallest average property price growth, after London’s decline. 

It comes as seperate data, from Nationwide, today revealed how UK house prices had risen by more than 10 per cent in 2021, the fastest growth rate in 15 years.

According to the figures, the price of an average UK home hit a record high of £254,822 in December, up nearly £24,000 over the year.

Average house prices are now 16 per cent higher than before the pandemic struck in early 2020.

Meanwhile, figures released by estate agent Savills earlier this week showed that the cost of prime housing outside London had surged at the strongest pace for a decade this year – driven by as wealthy homeowners looking for more space during the working from home revolution.

The Cotswolds saw the fastest growth, with country houses worth more than £2million piling on nearly a quarter (23.4 per cent) to their value, with demand coming from local homeowners looking to upsize, those relocating and aspiring second home owners.

Prime coastal markets, most notably Devon and Cornwall, recorded average price growth of 15.6 per cent during the year, Savills revealed. By contrast, central London saw growth of just 2 per cent, although in the suburbs this was higher at 13.6 per cent.

The prime market broadly makes up the top 5 to 10 per cent of homes by value. The properties are typically the most desirable and most expensive in a given location. They include country homes and those in coastal markets. 

Price growth in the prime housing markets outside the capital averaged 9.3 per cent this year, marking the strongest annual growth since 2010. It came as buyers looked for more space and made lifestyle changes as a result of the pandemic.

Properties by the sea, in the glorious Cotswolds countryside and commutable private estates tended to be the strongest performers.

‘In these markets, the rarity factors – whether it’s a rarely available type of property, the most sought after locations, or simply the best view – have combined with high levels of buyer demand and wealth to create pockets of extremely strong market conditions,’ said Frances Clacy of Savills.

‘New buyer numbers over the past month are running 1.5 times higher than at the same time in the two years pre-pandemic, suggesting that these trends will carry through into the early part of next year, at least.’