Nationwide: UK house prices return to double digit growth with homes now 15% above pre-pandemic prices

·2 min read
Prices continue to rocket higher (PA)
Prices continue to rocket higher (PA)

UK house prices have returned to double digit percentage growth after a brief lull at the end of the stamp duty holiday in September.

Nationwide said its House Price Index recorded price growth of 10% in November, a touch higher than the 9.9% recorded in October. The average price of a UK house now stands at £252,687, which is almost 15% higher than pre-pandemic levels in March 2020.

Robert Gardner, Nationwide’s chief economist, said: “There have been some signs of cooling in housing market activity in recent months. For example, the number of housing transactions were down almost 30% year-on-year in October. But this was almost inevitable, given the expiry of the Stamp Duty holiday at the end of September, which gave buyers a strong incentive to bring forward their purchase to avoid additional tax.

“The number of housing transactions so far this year has already exceeded the number recorded in 2020 with two months still to go and is actually tracking close to the number seen at the same stage in 2007, before the global financial crisis struck.”

On a monthly basis, prices grew by 0.9%, up from 0.7% a month earlier. Gardner said the market was expected to remain “fairly buoyant” in the months ahead but said “rising interest rates may exert a cooling influence on the market.”

Guy Gittins, CEO of Chestertons, said: “November saw a slight drop in finalised sales. This is an expected side effect following house hunters prioritising their first summer holiday since lockdown in August and September, which automatically led to fewer viewings during this time.

“Whilst November’s property sales have temporarily levelled out from the record-setting first half of the year, buyer enquiries for London properties still remain 20% higher than this time last year, when we had the added incentive of the Stamp Duty holiday, and 47% higher than 2019.”

Mark Harris, CEO of mortgage broker SPF Private Clients, said: “While the froth has gone, there is still plenty of activity as this will be the busiest year for the housing market since 2007 in terms of number of transactions.”

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