House price growth rises further to 11% in August: Nationwide

"These hot market conditions are likely to remain beyond the summer months and well into autumn as we enter what is traditionally one of the busiest times of the year for the UK market."

Prices rose 2.1% month-on-month, the second largest gain in 15 years, with the average house price now close to £250,000.

Robert Gardner, Nationwide's chief economist, said: "House prices are now around 13% higher than when the pandemic began.

“The bounce back in August is surprising because it seemed more likely that the tapering of stamp duty relief in England at the end of June would take some of the heat out of the market. Moreover, the monthly price increase was substantial – at 2.1%, it was the second largest monthly gain in 15 years (after the 2.3% monthly rise recorded in April this year).

“The strength may reflect strong demand from those buying a property priced between £125,000 and £250,000 who are looking to take advantage of the stamp duty relief in place until the end of September, though the maximum savings are substantially lower (£2,500 compared to a maximum saving of £15,000 on a property valued at £500,000 before the stamp duty relief in England tapered).

“Lack of supply is also likely to be a key factor behind August’s price increase, with estate agents reporting low numbers of properties on their books."

Managing director of StripeHomes, James Forrester, commented: “The largest monthly gain in 15 years tells you all you need to know about the current health of the UK property market and it’s now abundantly clear that the tapered end of the stamp duty holiday isn’t going to be the significant event that many predicted in terms of its impact on property values.

While it certainly spurred a revival in homebuyer demand, this increased intent to purchase has been driven by a desire to own our own homes, not to save a few thousand pounds, and this desire will continue to burn long after the final deadline has expired at the end of September.”

Director of Benham and Reeves, Marc von Grundherr, added: “We’re seeing no let up in the extreme levels of house price growth seen in recent months. These hot market conditions are likely to remain beyond the summer months and well into autumn as we enter what is traditionally one of the busiest times of the year for the UK market.

Of course, a slight dip can be expected come the end of the year. But those running for the hills at the first sight of a marginal monthly decline will do well to remember that even the best performing markets are subject to seasonal influences.”