Biggest property price increase in 17 years

UK property prices increased at the fastest pace since 2004 according to Nationwide's April House Price Index and could hit double figures by June. At the city level, it is still the North and Midlands leading the way.

Just one year ago, the prospect of a property boom would have seemed absurd. Yet here we are, with the major indeces registering the fastest start to the spring season in more than 15 years.

​Fuelled by a dearth of available properties, a 70% plus increase in demand from pre-covid days and by government intervention, both transactions and prices are at record highs.

The big picture - Nationwide

Headlines -

• Annual house price growth rebounded to 7.1% in April, from 5.7% in March
• Prices up 2.1% month-on-month, the biggest monthly rise since February 2004
• Annual growth will reach double digits in June if prices are flat over next two months
• New record high average price of £238,831, up £15,916 over the past 12 months

	April 2021	March 2021
Monthly change	2.1%	-0.3%
Annual change	7.1%	5.7%
Average Price ​Not seasonally adjusted	£238,831	£232,134

Housing market activity is likely to remain fairly buoyant over the next six months as a result of the stamp duty extension and additional support for the labour market included in the Budget, especially given continued low borrowing costs and with many people still motivated to move as a result of changing housing preferences in the wake of the pandemic.

With the stock of homes on the market relatively constrained, there is scope for annual house price growth to accelerate further in the coming months, especially given the low base for comparison in early summer last year. Indeed, if house prices remain flat in month-on-month terms over the next two months, the annual rate of growth will reach double digits in June.

​Robert Gardner, Chief Economist, Nationwide

City-by-city - Zoopla/Hometrack

Headlines -

• Buyer demand hits new highs but set to moderate as lockdowns ease across the country
• The value of new homes sold in the first 15 weeks of 2021 was double that in the same period in 2019
• High sales volumes are eroding the supply of homes for sale, with stock levels down nearly 30% in April this year compared to the same period in 2017-2019
• The demand/supply imbalance is increasingly focused on family houses

	Average Price	March 2021 ​y-o-y	March 2020 ​y-o-y
Manchester	£185,800	6.5%	4.0%
Liverpool	£130,600	6.3%	3.6%
Leeds	£179,100	5.4%	3.7%
Nottingham	£169,500	5.2%	5.1%
Leicester	£195,400	5.1%	4.3%

Annual price growth in the year to March continues to outperform in regions where homes are more affordable, with values growing at an annual pace of 5.9% in Wales, 5.3% in Yorkshire and the Humber and 5.2% in the North West of England. London, which has the highest average prices for homes of any region is lagging, with 2% growth over the year.

At a city level, Manchester and Liverpool retain their spots at the top of the price charts, with 6.5% and 6.3% annual growth respectively. At the other end of the scale for major cities, Aberdeen prices are down -1.7% on the year, although this is a more modest decline than the -3.1% seen in March last year. Oxford and Cambridge, two of the markets with highest value housing, are registering relatively muted growth of 1.6% and 2%.

​Zoopla/Hometrack

All content from Nationwide (full report) and Zoopla (full report)