The building society’s monthly house price index found that the average price rose from £172,127 in September to £173,678 in October, 5.8 per cent higher than October 2012 but still 7 per cent below the 2007 peak.
Robert Gardner, chief economist for Nationwide, cited the increasing ability and willingness of potential buyers to transact as a reason for the increase. This has been fuelled by the government’s Help to Buy and Funding for Lending schemes, in addition to rates “close to all-time lows”.
However he warned that “if demand continues to strengthen while the supply of property remains constrained, affordability could become stretched”.
Peter Williams, executive director of the Intermediary Mortgage Lenders Association, said: “Thanks to the restoration of consumer confidence and improved access to lending there is renewed vigour in the market.”
Brian Murphy, head of lending for national intermediary the Mortgage Advice Bureau, said: “It’s unsurprising that consumers are grabbing the opportunity to jump on the property ladder. However we must ensure that those with low deposits are not left behind and that mortgage finance remains accessible and affordable.”
£173,678 – average UK house price in October
5.8 per cent increase since October 2012