London’s biggest building society has reported that house prices in the United Kingdom (UK) made a surprisingly strong jump in November to sit just 1% below an all-time high.
The average U.K. house price rose by 1.2 per cent month-on-month in November, according to Nationwide Building Society, which was the biggest increase since March 2022.
The annual price growth rate rebounded to 3.7 per cent in November, from 2.4 per cent in October, marking the fastest rise since November 2022.
Across the U.K., the average house price in November was £268,144.
Robert Gardner, Nationwide’s chief economist, said that house prices are just 1% below the all-time high recorded in the summer of 2022.
“The acceleration in house price growth is surprising, since affordability remains stretched by historic standards, with house prices still high relative to average incomes and interest rates well above pre-Covid levels.”
Stamp duty is set to revert to its previous levels next spring.
For first-time buyers in England and Northern Ireland, a temporary “nil rate” threshold will go back to £300,000, from the current level of £425,000.
But Mr Gardner said that the pick-up in price growth is unlikely to have been driven by upcoming stamp duty changes, since the majority of mortgage applications commenced before the Budget announcement.
“Housing market activity has remained relatively resilient in recent months, with the number of mortgage approvals approaching the levels seen pre-pandemic, despite the higher interest rate environment.
“Solid labour market conditions, with low levels of unemployment and strong income gains, even after taking account of inflation, have helped the activity and house prices since the start of the year.”
