The latest Nationwide House Price Index for August show:

• Annual house price growth rose to 11.0% from 10.5% in July
• Prices up 2.1% month-on-month, the second largest gain in 15 years
• Average house price nudges towards £250k mark

Commenting on the figures, Robert Gardner, Nationwide's Chief Economist, said:

“Annual house price growth increased to 11% in August, from 10.5% in July. Prices rose 2.1% in month-on-month terms, after taking account of seasonal effects. 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).“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.Imbalance between supply and demand bad news for relocation movesJonathan Hopper, CEO of Garrington Property Finders, comments:“July’s slowdown in price growth was a speed bump not a stop sign. The market put its foot firmly back on the gas in August, with the price rises accelerating sharply.“August is often a quieter month for price growth as many buyers put their property search on pause during the height of the holiday season. “Not this year. August’s 2.1% surge in average prices was the second biggest monthly price jump seen by the Nationwide in a decade and a half.“With the distorting effects of the Stamp Duty holiday fading, this latest surge in price growth may be the product of a rapidly recalibrating market.“HMRC data shows the number of transactions completed in June soared, before plunging by nearly two-thirds in July, as buyers raced to complete before the tax break began to taper away at the end of June.“But Nationwide’s data shows prices continued to rise sharply last month as demand remained strong. Metaphorical queues outside estate agents may now be a less common sight, but with supply not keeping up with demand, the upward pressure on prices remains intense.“England’s Stamp Duty holiday officially ends at the end of September, but with the savings it offers now pretty modest, the property market is being driven by the old-fashioned dynamics of demand and supply.“As in so many other industries, a constrained supply chain is holding back the number of homes coming onto market and this is fanning the flames of price growth.“While no-one expects the double-digit pace of annual price growth to last, the ongoing imbalance between suppy and demand, combined with cheap mortgages that are helping buyers absorb some of the rising costs, means market conditions are unlikely to change dramatically any time soon.”UK residential property buyers are still determined to move Lucy Pendleton, property expert at independent estate agents James Pendleton, said: “It turns out that, for all the posturing, the stamp duty discount wasn’t doing any of the pushing after all.“This is a timely lesson that it’s the fundamentals of the market that are all-powerful still. Sunak’s generous state handout has turned out to be more a demonstration of misdirection than crisis management.“The market didn’t need his money and, with hundreds of billions tucked away in accidental savings, Britons are continuing to satisfy a deep-seated determination to move after a traumatic 18 months.“First-time buyers have had their patience sorely tested and are now being pulled back into the frenzy in increasing numbers. Where, once, most of them would have bet on the market cooling and giving them a chance to seek better value, fears that rising inflation will put a protective arm around this bull run are cutting down those numbers. This readout for August has relegated a strategy of ‘wait-and-see’ to wishful thinking.”

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