Nationwide: Soaring house prices and low rates hike profit at building society to £801m

The rise in house prices across the UK has lifted up Nationwide's profit in the first half of its current financial year. The building society reported on Friday (20 November) that pre-tax profit jumped by more than a quarter compared to the six months in 2014.

The 26.8% jump in pre-tax profit in the half year to September 2015 to £801m ($1.22bn, €1,145bn) was mainly caused by a jump in mortgage lending, which increased by 13.8%, increasing Nationwide's market share to more than 13%.

"This has been our best ever half year of mortgage lending along with a strong inflow of savings and the opening of over a quarter of a million new current accounts," the building society's chief executive Graham Beale said. "All this has been achieved in the face of fierce competition and by continuing to invest in innovative services and long term good value products for new and existing members."

With record low mortgage rates and an increase in wages, many people are keen on buying a house for the first time, or upgrading to a more valuable property. House prices have been soaring on the back of this demand and a lacking supply.

Although an increasing number of people are having a hard time entering the property market, Nationwide reported an 8% jump in the amount of first time buyers it has helped buy a home. In the first half of the 2015-16 financial year, the building society helped some 25,700 buy a first house.

Nationwide also told shareholders that it has made significant efforts to save costs and the mortgage lender increased its member deposit balances by £2.6bn.