United Kingdom: Annual house price growth accelerates into double figures in May
According to the Nationwide Building Society, house prices in the United Kingdom rose 1.8% month-on-month in May, following April’s 2.3% growth. On an annual basis, house prices were up 10.9%, above April’s 7.1% and marking the fastest growth in nearly seven years. May’s acceleration likely reflected the stamp duty holiday, improved consumer sentiment as the country moved out of lockdown, and changing housing preferences in the wake of the pandemic—particularly a desire for more space.
On the near-term outlook, Robert Gardner, chief economist at Nationwide, commented:
“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, improving credit availability 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 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.”