UK house prices jump 5.7% in March, Nationwide data shows

UK house prices rose 5.7% in March to an average of £200,251 compared to the same month last year, data revealed on Friday.

Nationwide’s figures for March marked acceleration from February’s 4.8% year-on-year gain and was the fastest annual pace of growth in just over a year.

On a month-on-month comparison, house prices rose 0.8% in March compared to 0.4% in February.

The increase last month was in part fuelled by second home owners and buy-to-let buyers trying to make purchases before the 3% increase in stamp duty on 1 April, Nationwide said.

"The pace of house price growth may moderate again once the stamp duty changes take effect," said Robert Gardener, Nationwide’s chief economist.

However, he believes falling unemployment, wage growth, low interest rates and a shortage of properties on the market will continue to push prices higher.

Chancellor George Osborne announced the increase in stamp duty in an effort to cool the strong growth in the buy-to-let market and deter investors from buying a raft of homes, which have been making it difficult for first home buyers.

Nationwide also posted its quarterly regional house price statistics which showed 5.3% year-on-year increase in the first quarter to an average of £198,564 in the UK.

The gap in price growth between the South and North of England widened further in the first quarter.

London and outer metropolitan areas were the biggest drivers of growth. House prices in the capital jumped 11.5% to £455,984 while prices in the outer metropolitan edged up 12.2% to £344,371.

The North of England and Scotland were the worst performers, falling 1.1% to £123,864 and 0.2% to £139,911 respectively.

Average house prices in England climbed 7.7% in the first quarter.