Its latest house price index revealed prices had risen by 0.9% month-on-month pushing the average house price up to £229,721.
Robert Gardner, chief economist at Nationwide, said the 6.5% rise, which comes following at 5.8% annual increase in October, was the highest outturn since January 2015.
He said despite the headwinds caused by the economic recovery losing its momentum, rising unemployment and the extension of the furlough scheme, the housing market had remained ‘robust’.
“October saw property transactions rise to 105,600, the highest level since 2016, while mortgage approvals for house purchase in the same month were at their highest level since 2007 at c97,500,” Gardner added.
“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.
“Behavioural shifts as a result of Covid-19 may provide support for housing market activity, while the stamp duty holiday will continue to provide a near term boost by bringing purchases forward.”
Industry comment
Jeremy Leaf, north London estate agent and a former RICS residential chairman, said the pace of the buyer rush had calmed somewhat in recent weeks.
“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.”
Others, however, thought prices might take a turn as the stamp duty holiday draws to a close. Miles Robinson, head of mortgages at online mortgage broker Trussle, said: “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.
“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.”
