Residential property prices increased up to three times faster in some rural and coastal areas compared to the national average in July, according to the Office of National Statistics (ONS).

The data shows that North Devon has seen a rise of 22.5%, while the UK average rose by 8%.

A lack of affordable homes could be contributing to hospitality struggling to fill vacancies, the ONS said.

The average cost of rent in the south-west of England rose by 2.6% in the year leading to August, more than double the 1.2% increase for the UK as a whole.

The ONS said: “Rising house prices and private rents mean that some workers are at risk of being priced out of living in rural and coastal areas, contributing to skill shortages in the tourism and hospitality industries that their local economies rely on.”

Nathan Emerson, Propertymark CEO, said: “The pandemic has been a catalyst for change in many people’s lives and we are now seeing a rush for larger properties, more outside space and more idyllic living. Couple this with low interest rates and the stamp duty holiday and what we have seen is a tremendous amount of pressure on rural and coastal areas whose housing provision and infrastructure are not designed for such an influx.

“We’ve also seen house prices in these areas inflate; this is because many properties have seen such demand that they have gone to best and finals with up to 19 buyers per home. As buyers from out of area bring with them higher wages, the bidding wars have been astronomical in certain hot spots.

“Other areas, mainly cities such as London, have seen a dramatic decrease in demand and therefore low prices. Because of this, we have seen these places become more attractive for investors.”

Kate Allen, owner at holiday lettings agency, Salcombe Finest, commented: “The sea is a cruel mistress and property prices in many coastal areas of the country, including south Devon, are running a close second.”

Jamie Thompson of Jamie Thompson Mortgages remarked: “Tell a property expert two years ago that there is about to be an unprecedented world health pandemic and they’d tell you that house prices were about to fall off a cliff. The banks thought so, too, hence why they pulled their high loan to value products. But guess what, the experts would be wrong, again.”

Robert Payne, co-founder of Langley House, added: “Buyer preferences have largely shifted away from city centre living to properties that are a bit more rural, with garden space and room to work from home. I believe this growth is sustainable and house prices that have rocketed up in value will not drop.

“Some city centre properties that have increased in value for so long have now plateaued and the growth they would usually have seen has been redistributed to other parts of the country. The good news is that, despite the increased values, they are still more affordable than city centre properties so first-time buyers have the chance to get on the ladder.”