Nationwide record the largest annual increase since 2004. Property prices grew by 0.7% in June, raising the average cost of a home to £245,432 - 13.4% higher than a year ago. Lack of supply continues to drive the rental market.
The last time we saw property price hikes this extreme was back in 2004. Although the figures come off a low base in June last year, they still represent a month-on-month increase as buyers close out purchases before the tapering of the stamp duty holiday.
Wales and Northern Ireland saw the strongest gains in their quarterly averages at 13.4% and 14% higher than Q2 2020. London's traditional commuter towns were up an average of 8.2%, while prices in the outer South East increased by some 10.4%.
Nationwide's numbers for June -
Looking forward -
Underlying demand is likely to remain solid in the near term as the economy unlocks. Consumer confidence has rebounded while borrowing costs remain low. This, combined with a lack of supply on the market, suggests further upward pressure on prices. But as we look toward the end of the year, the outlook is harder to foresee.
Tenant demand reaches an all time high
The number of new prospective tenants reached a record high for the month of May according to the Association of Residential Letting Agents.
Figures provided by the association's members show an increasing demand for rental properties. The number of new tenant applications rose to 97 per branch, up from 82 in April and 70 in May last year.
The West Midlands was the region with the highest number of new registrations at 132 per branch.
The lack of availability of properties remains an issue. Members' branches managed an average of 203 properties each, up just 2 from April.
Rent rises remain consistent. 68% of properties due for renewal in May saw rent increases, almost unchanged from April.