House prices increased 1 per cent between March and April this year, with the average property price rising from £164,519 to £167,802.
Nationwide chief economist Martin Gahbauer says: “April’s figures show the first double-digit annual growth in UK house prices since June 2007.
“The year-on-year rate in this month’s figures, however, received an additional boost from the fact that April 2009 was one of the weaker months last year.
“Given the very strong performance of house prices from May 2009 onwards, it will take monthly increases in excess of 1 per cent for the annual rate of inflation to be maintained in double digits going forward.”
The Buying Agents chief executive Tim Hammond says: “The concern is that this house price recovery is being fuelled entirely by fear and uncertainty amongst buyers and sellers, rather than an efficiently performing market.
“On the one side you have buyers who are being told by estate agents that they must buy now because property prices are rising rapidly and they could miss out. On the other side, you have sellers who are reluctant to put their properties on the market until the general election is over. The picture will be much clearer post May 6.”
Hammond says that at the moment estate agents are seeing a lot of sealed bids from buyers on the few highly desirably properties on the market.
He adds: “We are also likely to see over the coming months plenty of homebuyer’s remorse, from buyers who regret being pushed into buying a property they did not really want.
“Hopefully, once the general election is behind us, a semblance of certainty and normality will return to the market, and we may start to see a market that is operating not on fear, but on the true value of a property and what a buyer is prepared to pay.”
He says this might lead to another house price correction in the short term, but in the longer term it should lead to a sustained recovery.