02 May 2014
Annual house price growth in the UK has hit double digits for the first time in four years, according to Nationwide. In the year to April, prices rose by 10.9%, the first annual double-digit growth since April 2010 and the fastest rate since June 2007.
Robert Gardner, Nationwide’s chief economist said: “After several months of moderation, the pace of house price growth picked up in April, with prices rising by 1.2% during the month.”
There remains a significant gap between the capital and the rest of the UK. House prices in London are now about 20% higher than they were before the financial crisis of 2007-08, while in the rest of the country prices are still around 2% lower than their pre-crisis peak.
Some commenters expect prices to moderate again over the next few months, following the Mortgage Market Review by the Financial Conduct Authority, which imposes tougher rules on lending and is likely to mean that more people are refused mortgages.
However, the deputy Governor of the Bank of England Jon Cunliffe has warned that it would be “dangerous to ignore the momentum that has built up in the UK housing market “, and that “a mutually reinforcing combination of strong demand, weak supply and expectations of a rising market could lead to a period of sustained and very powerful pressure on house prices” which could “take us quickly to pre-crisis rates.”