Annual house price growth accelerated to 13.4% in June, the highest level since November 2004, according to latest data from the Nationwide Building Society.
All UK regions recording a pickup in the second quarter.
The UK’s largest building society reported that house prices were up 0.7% month-on-month, after taking account of seasonal factors.
Northern Ireland saw the strongest growth in Q2, Scotland the weakest, closely followed by London.
Robert Gardner, Nationwide’s chief economist, said: “While the strength is partly due to base effects, with June last year unusually weak due to the first lockdown, the market continues to show significant momentum. Indeed, June saw the third consecutive month-on-month rise (0.7%), after taking account of seasonal effects. Prices in June were almost 5% higher than in March.
“Regional data for the three months to June indicates that all parts of the UK saw an acceleration in annual house price growth. Northern Ireland and Wales saw the largest gains, at 14% and 13.4% respectively in Q2. By contrast Scotland saw the weakest rate of annual growth, at 7.1% closely followed by London at 7.3%.
“Despite the increase in house prices to new all-time highs, the typical mortgage payment is not high by historic standards compared to take home pay, largely because mortgage rates remain close to all-time lows – in fact, on this measure affordability remains broadly in line with its long run average.”
James Forrester, managing director of Barrows and Forrester, added: “The stamp duty holiday isn’t the be-all and end-all where homeownership is concerned and it certainly isn’t the primary factor causing buyers to enter the market at mass. So its tapered expiry is unlikely to cause current levels of market activity to evaporate overnight.
“Once both the initial and extended deadlines have expired, the fires of buyer demand will continue to be stoked by the availability of 95% mortgage products and very low interest rates. Of course, there will be some period of natural market realignment after such a sustained period of manic activity, but we’re worlds away from seeing a property market crash.”
