House prices increased by 6.5% over the last year and by 0.9% in November compared to the previous month, as buyers continued to seek out new properties and complete on the deal in time for the stamp duty holiday deadline in March 2021.
Robert Gardner, chief economist at Nationwide, said the 6.5% rise, which comes following at 5.8% annual increase in October, was the biggest growth it had experienced since January 2015.
And he said despite the economic downturn, rising unemployment and the extension of the furlough scheme the housing market had remained ‘robust’ during this period.
But he added a word of caution on how the property market might fare going forward. “The outlook remains highly uncertain and will depend heavily on how the pandemic and the measures to contain it evolve as well as the efficacy of policy measures implemented to limit the damage to the wider economy,” Gardner said.
Expert reaction
Industry experts were divided over whether they thought house prices would continue rising. Jeremy Leaf, north London estate agent, said he expected things to remain stable, despite the stamp duty holiday deadline looming.
“These figures feel like the storm before the calm,” he said, “as buyers and sellers rushed to take advantage of the stamp duty holiday before the March deadline, despite continuing Covid restrictions in October, the possibility of a no-deal Brexit and economic growth stalling.
“That frenzy has been since replaced by a quieter, but just as determined mood to complete sales previously agreed.
“We don’t see any signs either of significant price adjustments, irrespective of whether there is an extension to the stamp duty holiday, with activity continuing to be supported by a shortage of listings and longer-term low interest rates.”
But Miles Robinson, head of mortgages at online mortgage broker Trussle, thought they may begin falling soon and this would offer some hope to first-time buyers.
“The silver lining for those who do miss out on the stamp duty holiday is that if demand for properties falls, so could house prices,” he said.
“This could be beneficial for first-time buyers, especially now that high loan-to-value mortgage products are also returning to the market, with 80 90% LTV mortgages now available. As such, things still could level out.
Mortgage advice
“We’re also encouraging those who are concerned about their finances to keep an eye on their current mortgage. Mortgages are often the biggest monthly bill that people face and it’s worth using a remortgage calculator to see if switching could save you money.”
