Annual house price growth has picked up at the fastest rate in over two years, new figures have revealed.
Across the UK, property values increased by 2.4 per cent year-on-year, Nationwide Building Society said.
This means the average home cost £6,222 more than the previous year, with an average sale price of £265,375.
Nationwide’s chief economist Robert Gardner said: “UK house prices fell by 0.2 per cent month-on-month in August, after taking account of seasonal effects, but the annual rate of house price growth continued to edge higher.
“Average prices were up 2.4 per cent year-on-year, a slight pick-up from the 2.1 per cent recorded in July and the fastest pace since December 2022 (2.8 per cent).
“However, prices are still around 3 per cent below the all-time highs recorded in the summer of 2022.”
Tom Bill, head of UK residential research at estate agent Knight Frank, said: "The UK housing market is in a better place than it was last summer as inflation comes under control and lenders trim their rates.
"Financial markets are pricing in another cut this year and as mortgage rates fall this autumn, it should [mean] modest single-digit price growth."
Yopa chief executive Verona Frankish added: “Today’s figures provide the first look at house price performance since interest rates were cut at the start of August and despite the very marginal monthly decline, it’s clear that the first reduction in four years has helped to further boost the market momentum, with yet another strong rate of annual house price growth being seen.
“Whilst the base rate remains considerably higher than many buyers and sellers may be accustomed to, the expectation is that another cut will come before the year is out, which should only help to strengthen buyer appetites further.”
Amy Reynolds, head of sales at London-based estate agency Antony Roberts, said: "It's been a very successful month, with a large number of sales agreed in all price ranges at a time when agents usually complain it is quiet.
"As the [Bank of England base interest] rate reduction was widely expected, we were ready - encouraging sellers to reduce their price, or launch their properties at the end of July/beginning of August, rather than wait until September as most would usually choose to do."
This article was written by Alexander Butler from The Independent and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.