"Despite the apocalyptic hit to the economy, the property market glass is half full at the Nationwide."
Annual house price growth increased to 3.7% in April, according to the latest Nationwide house price index, which captures largely pre-pandemic data.
Growth was up from 3% in March to the fastest pace seen since February 2017. There have been month-on-month gains for the last seven months in a row, after taking account of seasonal effects.
However Nationwide highlighted that the impact of the pandemic is not fully captured in this month’s figures as its index is constructed using mortgage approval data.
Around 80% of cases in the April sample relate to mortgage applications that commenced prior to the lockdown, and hence before the full extent of the impact of the pandemic became clear.
Robert Gardner, Nationwide's Chief Economist, said: “In the opening months of 2020, before the pandemic struck the UK, the housing market had been steadily gathering momentum. Activity levels and price growth were edging up thanks to continued robust labour market conditions, low borrowing costs and a more stable political backdrop following the general election.
“But housing market activity is now grinding to a halt as a result of the measures implemented to control the spread of the virus, and where the government has recommended not entering into housing transactions during this period.
“Indeed, a lack of transactions will make gauging house price trends difficult in the coming months. Our ability to produce the index in the months ahead will depend on there being sufficient transactions which are representative of the wider housing market."
Andrew Montlake, managing director of Coreco, commented: "Despite the apocalyptic hit to the economy, the property market glass is half full at the Nationwide.
"Nobody is expecting the property market to be switched back on like a scene from Westworld but there are reasons to be positive.
"The unprecedented package announced by the Government to support business and jobs, along with rock-bottom borrowing rates, should mitigate the fallout from the lockdown.
"Transaction volumes will naturally be down throughout the rest of the year, and prices will be under pressure, but there will always be people wanting to buy and move home.
"As devastating as the pandemic is, property is in this country's DNA and people will return to it once lockdown measures are eased."
Lucy Pendleton, founder and director of James Pendleton estate agents, added: “Gazundering is back but it’s getting short shrift from vendors. That’s a sure sign that the strong growth that the Nationwide reports was building before the pandemic struck could find its feet again over the summer.
“This market may be running on fumes right now but the vast majority of the clients we are speaking to aren’t being panicked into lowering their prices on sales agreed before the pandemic took hold.
“Any attempts at gazundering have been met with polite invitations to just walk away. If dealt with correctly, some of these buyers will come back to the table with their original offers once the dust settles and the lockdown is out of the way.
“The market is coiling itself up like a spring just like it did during the Brexit years. This latest growth figure, though it has to be taken with a big pinch of salt, was the result of all that pent up energy being released. This time we’ll be expecting just as big a post-lockdown leap in activity to make up for all the lost time.”