UK risks ‘losing its place as property-owning democracy’, says estate agent boss, as house prices rise further

Latest figures show the average cost of a home jumped £10,000 last year and 'unaffordability is reaching crisis point', according to Paul Smith, chief executive of haart

Property values increased by 0.8 per cent between May and June according to joint figures from the Office for National Statistics, Land Registry and other bodies (PA)

The UK risks losing its place as a property-owning democracy if house prices continue to rise, according to the boss of the UK’s largest independent estate agent.

Paul Smith, chief executive of haart, said that “unaffordability is reaching crisis point” and urged the Government to stop “excessive profiteering” at the expense of aspiring home owners.

The call comes as official figures showed that the price of the average house in the UK increased by £10,000 last year to £223,000.

Property values increased by 0.8 per cent between May and June according to joint figures from the Office for National Statistics, Land Registry and other bodies.

In the year to June average prices were up 4.9 per cent, down marginally from 5 per cent growth in the year to May.

The report released on Tuesday said the annual growth rate had slowed since mid-2016 but has remained steady at about 5 per cent this year so far.

“House prices continued to rally with unflinching determination once again in June despite the ongoing economic uncertainty," Mr Smith said.

“However this means that the average UK buyer now has to fork out an extra £10,000 more to own a home than the same time last year.

“Along with consumer price hikes and falling wage growth, unaffordability is reaching a crisis point. This is creating real impact on the ground as we see first-time buyer registrations drop by almost 20 per cent on the year across our branches.”

Mr Smith called on the Government to cut the “stamp duty stealth tax” to ease the burden on those looking to buy a home. The tax on property transactions has seen several increases in recent years. The latest changes saw a 3 per cent surcharge introduced in April last year for stamp duty on buy-to-let properties second homes.

“The resolution is clear – Government must stop excessive profiteering at the expense of the aspiring homeowner and cut the stamp duty stealth tax. Unless we see a more comprehensive break for first-time buyers, the UK’s legacy as a property-owning democracy is at risk of vanishing,” he said.

Tuesday’s data revealed large differences in price rises across the country. The City of London saw the biggest decrease of any area, with a 20.3 per cent annual fall, though the ONS cautioned that the figures were volatile due to low transaction volumes.