House price growth 'fastest since June 2007', says Nationwide

Nationwide says the average UK house price now stands at £183,577

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The Independent Online

UK house prices increased by 1.2 per cent in April and were 10.9 per cent higher than in April 2013, according to latest figures from Nationwide, meaning that annual growth has reached double digits for first time since April 2010.

Nationwide's figures indicate the average price of a home is now £183,577, although other price indices put this figure much higher and Land Registry data out earlier this week put it more than £10,000 lower.

Nationwide's figures are based on mortgages they have approved, while the Land Registry index - which suggested prices had actually fallen in March - is based on complete sales and ignores sales of newbuild homes.

"The introduction of Mortgage Market Review  measures could have an impact on activity levels in the months ahead as the new measures bed down," said Robert Gardner, Nationwide's chief Economist.

"However, underlying demand is likely to remain robust, as mortgage rates remain close to all-time lows. Nevertheless, house price growth is outstripping income growth by a wide margin. The risk is that unless supply accelerates significantly, affordability will become stretched.

"A notable feature of the upturn in the housing market is that price growth has been significantly stronger in the South of England, especially in London and the South East. In the first three months of 2014, prices in the capital were around 20 per cent higher than their pre-crisis levels, while in the UK as a whole prices were still around two per cent lower."

He said that price growth in London and the South East appears to be being driven by the top end of the market, with higher priced locations recording stronger price growth.  In March, Nationwide's figures showed that prices in London had grown 18 per cent year-on-year.

Mark Harris, chief executive of mortgage broker SPF Private Clients, said "The housing market is showing no signs of slowing. Despite the Land Registry reporting that house prices have started to wobble, as far as Nationwide is concerned the pace of house-price growth is accelerating."

A report out today suggests that without a radical programme of house building, average house prices in England could double in 10 years to £446,000. The new research from KPMG and Shelter says that in 20 years they could quadruple.

The figures also suggest that more than half of all 20-34 year olds could be living with their parents by 2040 after being priced out of getting their own home.