HALIFAX, England: According to Halifax Bank, in 2021 UK house prices rose at 9.8 percent, a faster rate than in any calendar year since 2004, when it rose 12.5 percent.

Halifax Banks said buyers sought more space during the lockdown and took advantage of low-cost borrowing and stamp duty holidays, adding that in December the average UK property price reached a new record high at £276,091.

However, growth is expected to slow this year due to higher mortgage rates and a squeeze on household incomes.

Russell Galley, managing director at Halifax Bank, said the UK's housing market "defied expectations" in 2021, noting, "We saw the average house price reach new record highs on eight occasions, despite the UK being subject to a 'lockdown' for much of the first six months of the year," as quoted by the BBC.

However, he cautioned, "Looking ahead, the prospect that interest rates may rise further this year to tackle rising inflation and increasing pressures on household budgets suggest house price growth will slow considerably."

Lucian Cook, head of residential research at estate agency Savills, said UK housing remained a "strong sellers' market," especially for family homes.

He told the BBC, "There is an expectation the market will slow. We do not see the triggers for a price correction. From an economic perspective, unemployment was the big risk in that respect, and that looks to have been contained."

Although January is traditionally a quiet time of the year for the sector, many agents have reported continued demand from buyers.

Based on surveys and official figures, the most significant housing price increases in 2021 were generally outside London, with demand being notable in rural and coastal areas.