Thursday, August 28, 2025
  • About
  • Write for us
  • Contact
Today News
  • Business
  • Tech
    Artificial intelligence displayed on a vintage typewriter with the words "Artificial Intelligence"

    Artificial intelligence — The New Language of Tomorrow’s Economy, According to Aleksandr Katsuba

    Windows 11 Safely

    How to Download and Install KMSpico on Windows 11 Safely (Step-by-Step Guide with Alternatives)

    tech

    The Rise of Minimalist Tech: Why Consumers Are Choosing Compact Gadgets

    Revolutionizing

    How Technology Is Revolutionizing the Way We Travel

    Online Casino Game

    The iGaming software provider matters: Is it the best way for online casinos to achieve long-term success?

    Casino Slot Game

    Find Legit AU Online Casinos | Safe Gambling Guide

    Baby Sleeping Peacefully

    Understanding the Baby Monitor Market: What’s Driving Growth and Innovation

    Artificial Intelligence

    Europe’s AI Act Enters New Phase

    Close-up of a laptop screen displaying lines of code in a text editor, highlighting programming work in progress.

    How Technology Innovations Are Redefining Online Casinos and Sports Betting Experiences

  • Consumer
    Understanding the Baby Monitor Market: What’s Driving Growth and Innovation

    Understanding the Baby Monitor Market: What’s Driving Growth and Innovation

    Craving Connection: Why Food Gifting Is the New Love Language

    Craving Connection: Why Food Gifting Is the New Love Language

    How to Celebrate Milestones from Afar: The Rise of Digital Gifting in the UK

    How to Celebrate Milestones from Afar: The Rise of Digital Gifting in the UK

    How to adjust glasses at home – a step-by-step guide!

    How to adjust glasses at home – a step-by-step guide!

    Why quality toilet cubicle hardware matters

    Why quality toilet cubicle hardware matters

    Common Mistakes in KYC Identity Verification

    Common Mistakes in KYC Identity Verification

    Consumer habits

    British Furniture Market Sees Significant Changes in Consumer Preferences

    Why are high-street bookmakers declining in the UK?

    Why are high-street bookmakers declining in the UK?

    Straps for smartwatches: The Complete guide

    Straps for smartwatches: The Complete guide

  • Finance
    Senior Citizen in a wheelchair

    How to Support and Manage Your Parents’ Financial Decisions Through Dementia

    Mobile Apps for Managing Finances: What to Choose in 2025

    Mobile Apps for Managing Finances: What to Choose in 2025

    Bank Branch Presence in the UK: Then and Now

    Bank Branch Presence in the UK: Then and Now

    Financial graph illustrating investment performance

    Tradock Explained | What This Trading Platform Offers

    Investment Graph in different device screens

    Quantiumax Reviews: What Makes This Broker the Best Choice Available

    Panoramic view of London's skyline featuring iconic buildings like the Shard and the London Eye against a clear sky

    Can London Still Compete with Silicon Valley and Berlin in Tech Investment?

    Using a Laptop

    How to Accept Altcoin Payments and Upgrade Your UX Strategy

    Crypto Loans Meet Open Banking: Will Hybrid Products Redefine Borrowing?

    Crypto Loans Meet Open Banking: Will Hybrid Products Redefine Borrowing?

    Fintevex.io vs The Rest: What Happened When We Put It to the Test

    Fintevex.io vs The Rest: What Happened When We Put It to the Test

  • Environment
    Five Ocean Discoveries That Could Change How We See the World

    Five Ocean Discoveries That Could Change How We See the World

    Choosing the Right Sustainability Partner: How Eco-Efficient Tech Transforms Industry

    Choosing the Right Sustainability Partner: How Eco-Efficient Tech Transforms Industry

    Moving Abroad? Here’s What to Expect – and Why Cardboard and Plastic Waste Removal Is Essential After Unpacking

    Moving Abroad? Here’s What to Expect – and Why Cardboard and Plastic Waste Removal Is Essential After Unpacking

    How Weather Events Like Heavy Rain or Heatwaves Affect Pest Activity

    How Weather Events Like Heavy Rain or Heatwaves Affect Pest Activity

    Building a Carbon-Competitive Advantage with Sustainability and Decarbonization Consulting

    Building a Carbon-Competitive Advantage with Sustainability and Decarbonization Consulting

    The Lost Art of Orienteering: Why Map and Compass Skills Still Matter

    The Lost Art of Orienteering: Why Map and Compass Skills Still Matter

    Sustainability in Dining: Reducing Waste for a More Profitable Future

    Sustainability in Dining: Reducing Waste for a More Profitable Future

    Environmental Benefits

    What Are The Environmental Benefits Of Choosing Eco-friendly Rubbish Removal In Croydon?

    Why You Should Hire Waste collectors for efficient waste removal

    Why You Should Hire Waste collectors for efficient waste removal

  • Property
    Close-up of Bungalow Houses

    The Key Reasons Park Bungalows Are A Smart Investment

    Discovering the Charlie Oven The Rural Ranges Ltd Approach

    Discovering the Charlie Oven The Rural Ranges Ltd Approach

    Sleek and Sturdy Bathroom Glass Shelves for Modern Homes

    Sleek and Sturdy Bathroom Glass Shelves for Modern Homes

    How to Streamline Your Home Expenses

    How to Streamline Your Home Expenses

    How To Plan Your Home Improvements in Six Easy Steps

    How To Plan Your Home Improvements in Six Easy Steps

    Budgeting for a House Sale: What Most Sellers Forget

    Budgeting for a House Sale: What Most Sellers Forget

    Home and business removals: Streamlining your move

    Home and business removals: Streamlining your move

    Maximizing Your Investments: A Guide to Purchasing Villas for Sale in Dubai 2025

    Maximizing Your Investments: A Guide to Purchasing Villas for Sale in Dubai 2025

    6 Common Admin Mistakes that Property Managers Make

    6 Common Admin Mistakes that Property Managers Make

  • eCommerce
    From 1688 to shopee: the singaporean seller’s guide to paying china suppliers

    From 1688 to shopee: the singaporean seller’s guide to paying china suppliers

    The Importance of Digital Valuations for UK Ecommerce Brands

    The Importance of Digital Valuations for UK Ecommerce Brands

    Blink-and-Buy: Designing Checkouts That Convert in Under 10 Seconds

    Blink-and-Buy: Designing Checkouts That Convert in Under 10 Seconds

    High Stakes Strategies: Lessons E-commerce Entrepreneurs Can Learn from Casinos

    High Stakes Strategies: Lessons E-commerce Entrepreneurs Can Learn from Casinos

    Amazon Expert

    Amazon Expert: Key Qualifications to Look For

    Boosting Ecommerce Revenue with Smart Targeting Strategies

    Boosting Ecommerce Revenue with Smart Targeting Strategies

    Personalized Shopping: How Technology is Transforming Retail

    Personalized Shopping: How Technology is Transforming Retail

    How Can Ecommerce Businesses Learn From Entertainment Platforms?

    How Can Ecommerce Businesses Learn From Entertainment Platforms?

    Magento Web Development Company: Unlocking the Power of E-Commerce

    Magento Web Development Company: Unlocking the Power of E-Commerce

No Result
View All Result
Today News
Home Finance

Do house prices contribute to inflation?

Danielle Trigg by Danielle Trigg
March 23, 2022
Reading Time: 5 mins read
Do house prices contribute to inflation?
356
VIEWS
Share on FacebookShare on TwitterShare on LinkedIn

When we refer to economic inflation, this is essentially the rate at which the price of goods and services increase over time. When inflation rises at a higher rate than wages, this means the cost of living shoots up and we see a big squeeze on our wallets.

It can’t have escaped the notice of many people that the UK is currently facing record levels of inflation – the highest rise in 30 years in fact. We have also seen a bumper 18 months for house price growth. But how are the two linked and does house price growth contribute to inflation and vice versa?

Related posts

Senior Citizen in a wheelchair

How to Support and Manage Your Parents’ Financial Decisions Through Dementia

August 26, 2025
556
Close-up of Bungalow Houses

The Key Reasons Park Bungalows Are A Smart Investment

August 25, 2025
412

How is inflation calculated?

When it comes to calculating the rates of inflation in the UK, the Office for National Statistics (ONS) measures this in three ways.

  • The Consumer Price Index (CPI) – Whereby the ONS compares the prices of thousands of household goods and services year on year such as milk, bread and petrol and releases its measure of inflation each month, showing how much these prices have risen since the previous year. These items and services are also continually updated to reflect what we are actually spending our money on, with the addition of smart speakers in 2019 and, unsurprisingly in 2021, hand sanitiser.
  • The Consumer Prices Index with Housing (CPIH) – the most comprehensive measure of inflation which is identical to the CPI but with the addition of owner occupiers’ housing costs (including house prices) and Council Tax.
  • The Retail Price Index (RPI) – Introduced in 1947, the RPI measures the change in the cost of a representative sample of retail goods and services. Whilst still in use by the Treasury for calculating index-linked tax rises, RPI has since been superseded by the CPI and CPIH and is no longer considered an official “national statistic” by ONS. However, RPI is still calculated as part of the ONS inflation index to allow for consistent historical comparison.

Why is inflation at a record high right now?

The recent high levels of inflation are mainly as a result of soaring gas and electricity costs worldwide – with UK residents expected to see an average increase of £693 in household bills this year – increased shipping costs and a shortage of specific goods. Fears of disruption to global supply chains in the wake of the recent Russian invasion of Ukraine have also pushed the price of oil and gas even higher and the energy regulator Ofgem has made the decision to raise its price cap to £1,971 a year from 1 April, a huge 54% increase in 6 months.

Whilst these socio-economic events may be specific to this particular moment in time, the resultant discrepancy between supply and demand is a common theme for periods of high inflation. Where there is an increased demand and/or a reduced supply, then concurrently, prices go up, which is the case for both goods and services and housing.

As of January 2022, the rate of inflation CPIH was 4.9% and there are concerns that this could rise to 7% by the Spring of 2022.

What is the impact on house prices?

As we have seen, rising rates of inflation go hand in hand with the rising cost of house prices. Despite a brief dip in housing demand during the late noughties’ financial crisis, there has consistently been a strong demand in the late 20th and early 21st century. As a result, properties today cost around 121 times more than they did in the early 1950s according to Rightmove’s House Price Index.

Whilst a rise in house prices can have a positive impact by getting the market moving and encouraging would-be buyers to purchase a property before house prices rise further, on the flipside it may also see many potential homeowners priced out of the property market altogether. Unsurprisingly, rental prices also tend to rise with inflation, meaning a squeeze on budgets and less ability for first time buyers living in rental properties to save towards buying a home. That’s why there are a lot of buyers who prefer Pinerock Finance when planning on buying a house.

As for 2021, there were a number of very specific factors at play which saw the steep 10.8% rise in house prices from December 2020 – December 2021. This includes the pent-up demand following the initial covid-19 lockdown period from March – May 2020 when the housing market ground to a halt and the changing needs of a nation suddenly spending the majority of their working and leisure hours in homes that no longer fit the bill. Perhaps the most prominent factor, however, was the temporary reduction to stamp duty rates introduced from July 2020 – September 2021. All of these factors meant that demand significantly outstripped supply, with house prices soaring nationwide as a result, although at a faster rate outside of traditional urban hotspots such as London.

In 2022, house price growth looks set to continue thanks to the continued discrepancy between supply and demand, but at a much steadier pace now incentives like the stamp duty holiday have been removed and the impact of high inflation and rising living costs begins to be felt, making potential buyers more wary. Indeed, in October 2021, there was a 30% reduction in the number of property transactions compared to October 2020.

What can be done to tackle inflation and rising living costs?

As an immediate response to the energy crisis, the Chancellor has introduced the Energy Bills Rebate, which offers a one-off repayable £200 discount on energy bills for all households plus a council tax rebate of £150 for those in Bands A-D (80% of the population), although there are calls for the Government to provide more support for the most vulnerable.

To re-establish the rate of inflation at the preferred level of 2%, the Bank of England has chosen to increase interest rates twice since December 2021 from 0.25% to 0.5% (as of February 2022), for the first time since the covid-19 pandemic began.

Whilst higher interest rates are good news for savers, allowing more interest to be earned, for those paying off a mortgage or any other kind of loan, borrowing becomes more expensive. This is particularly the case for anyone who has undertaken a tracker rather than fixed rate mortgage, whereby payments are linked to the Bank of England’s interest rates. As such, there will need to be a balancing act between bringing inflation in line and causing a spike in living costs which could see substantial numbers of homeowners defaulting on their mortgages.

Danielle Trigg

Previous Post

What Countries Lead the Online Gambling Industry?

Next Post

The Six Best Research Paper Writing Services in the UK

Related Posts

Senior Citizen in a wheelchair
Finance

How to Support and Manage Your Parents’ Financial Decisions Through Dementia

August 26, 2025
556
Close-up of Bungalow Houses
Property

The Key Reasons Park Bungalows Are A Smart Investment

August 25, 2025
412
Mobile Apps for Managing Finances: What to Choose in 2025
Finance

Mobile Apps for Managing Finances: What to Choose in 2025

August 22, 2025
416
Bank Branch Presence in the UK: Then and Now
Finance

Bank Branch Presence in the UK: Then and Now

August 22, 2025
457
Financial graph illustrating investment performance
Finance

Tradock Explained | What This Trading Platform Offers

August 19, 2025
528
Investment Graph in different device screens
Finance

Quantiumax Reviews: What Makes This Broker the Best Choice Available

August 15, 2025
588
Next Post
The Six Best Research Paper Writing Services in the UK

The Six Best Research Paper Writing Services in the UK

RECOMMENDED NEWS

Key Differences Between Polygon and Ethereum Blockchains

Key Differences Between Polygon and Ethereum Blockchains

2 years ago
585
Revolutionizing UK Gambling: How Online Casinos Are Transforming the Industry

Revolutionizing UK Gambling: How Online Casinos Are Transforming the Industry

11 months ago
454
Unlock Success: How to Hire a High Ticket Closer for Your Business

Unlock Success: How to Hire a High Ticket Closer for Your Business

1 year ago
652
7 Unique Experiences in Portsmouth

7 Unique Experiences in Portsmouth

3 years ago
524

BROWSE BY CATEGORIES

  • Business
  • Careers
  • Charity
  • Consumer
  • Culture
  • eCommerce
  • Education
  • Energy
  • Engineering
  • Entertainment
  • Entrepreneurs
  • Environment
  • Fashion
  • Finance
  • Food & Drink
  • Gaming
  • Gardening
  • Health
  • Insurance
  • Interiors
  • Legal
  • Leisure
  • Lifestyle
  • Manufacturing
  • Marketing
  • National
  • News
  • Opinion
  • Pets
  • Politics
  • Property
  • Sales
  • Sport
  • Sports
  • Tech
  • Transport
  • Travel
  • Uncategorized

BROWSE BY TOPICS

Agency AI autosmart banking Beauty business Christmas construction cyber security data digital Digital Marketing Services ecommerce entertainmnet finance fitness Forex health inflation insurance kitchen KYND lifestyle manchester music News north overseas Personal Injury Pharmaceutical Industry property Real Estate recruitment Sir Michael Morpurgo Skincare sports technology tourism travel UK vehicles Warkworth village watch workspace yorkshire

Latest news

BONK saved Solana from becoming ordinary ― Here’s how

August 28, 2025
Bright neon sign reading "Game On," illuminating the surrounding area with vibrant colors.

The Rise of Gamification Across Industries

August 28, 2025
Close-up of a person gripping a smartphone with a mobile game on the screen, highlighting mobile gaming culture.

The Dawn of Mobile Gaming

August 28, 2025
Woman intently gazes at a casino slot machine, contemplating her next move.

Are online casinos safer than the high street? A look at security in 2025

August 28, 2025
Artificial intelligence displayed on a vintage typewriter with the words "Artificial Intelligence"

Artificial intelligence — The New Language of Tomorrow’s Economy, According to Aleksandr Katsuba

August 28, 2025
Ski lift elevated above the ground at a ski resort, with a backdrop of snowy peaks and clear blue skies.

Why ski resorts are the ultimate winter escape

August 28, 2025
Man driving a car at night, focused on the road with one hand on the steering wheel.

Gaining Independence: How Learning to Drive Changes Everyday Life

August 28, 2025
Weather-Resistant Printed Workwear for Outdoor Jobs

Weather-Resistant Printed Workwear for Outdoor Jobs

August 28, 2025
Sleep, Stress and Balance: Why More Britons Turn to Floral Solutions

Sleep, Stress and Balance: Why More Britons Turn to Floral Solutions

August 28, 2025
Comparing Regulatory Overhauls: How the UK’s New Land-Based Casino Reforms Passed into Law

Comparing Regulatory Overhauls: How the UK’s New Land-Based Casino Reforms Passed into Law

August 28, 2025

Today News

  • About
  • Write for us
  • Contact
  • Privacy Policy

@2024 Rooftree Publishing Ltd

Today News in association with Kajino.com

Sign up for our newsletter




  • Business
  • Tech
  • Consumer
  • Finance
  • Environment
  • Property
  • eCommerce

Recent News

BONK saved Solana from becoming ordinary ― Here’s how

August 28, 2025
Bright neon sign reading "Game On," illuminating the surrounding area with vibrant colors.

The Rise of Gamification Across Industries

August 28, 2025
No Result
View All Result
  • Home
  • Business
  • Tech
  • Consumer
  • Finance
  • Environment
  • Property
  • eCommerce
  • Write for us
  • About
  • Contact