The average house price in Wales has risen to a new peak of £226,577.
The figure, released from Principality Building Society’s Wales house price index for Q4 2021, is 8% higher than the same period the previous year.
Housing sales rose by 46% with more than 53,000 transactions in 2021 compared to 36,000 in 2020.
This was the first quarter for a year when house price inflation was in single figures, but still above the rate of inflation.
The index demonstrates the rise and fall of house prices in each of the 22 local authorities in Wales.
A total of 17 local authorities in Wales reported quarterly rises, up from 13 in Q3 2021 — the strongest showing since earlier in the year.
Every local authority recorded a rise in prices when compared annually.
Merthyr Tydfil experienced the strongest house price growth of any local authority. Annually it saw prices rise by 27.9% and by 16.9% quarterly.
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Neath Port Talbot also saw prices soar by 16.9% in Q4 after a fall in the previous quarter.
Anglesey recorded the steepest decline over the quarter but only down by nearly 4%.
Where authorities reported lower prices, the changes were less pronounced than those in the third quarter.
Principality’s report estimates that around 13,400 transactions were made in Q4 2021, 6% higher than in Q3, but 4% below the bumper 14,000 in the last quarter of 2020.
This is mainly down to a significant drop in sales of detached properties compared with a year earlier - down from 4,600 to 3,700.
The number of semi-detached homes sold was also slightly less than the previous year, but sales of terraces rose.
For the year as a whole, sales across all property types were 45-50% stronger than in 2020.
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However, sales of flats have barely recovered to the volumes seen in 2019, whereas house sales are up by as much as a fifth.
Chief financial officer at Principality Building Society, Tom Denman said the increasing sales and new price peak in Wales reflected a continued demand from potential buyers and a shortage of stock on the market.
He said: “Continuing low mortgage rates and high savings accumulated during lockdown meant that some households decided it was the time to move to areas with more space as lots of people continued to work from home.”
Mr Denman said he recognised how much harder it is for younger generations in Wales to get on the property ladder.
He said: “Most economic analysts predict rises will be moderate in 2022 as the effects of the transaction tax holiday subsides, but buying homes could become unaffordable for many people, partly because of the price rises that have already taken place in the past couple of years, however this could start to put downward pressure on prices.”
“While the economy is returning to some degree of normality, wage rises are still well below general price inflation. The continued increase in energy costs, imminent national insurance rises on top of rising interest rates, will all be considerations for those looking to purchase in the future.”