House prices rose by a monthly record of 4.7% in October bringing annual house price inflation to a new high of over 30%, Halifax announced last week.
Further confirmation of soaring house price inflation also came from Land Registry figures, generally regarded as the most accurate indicator of house price movements, which showed East Anglia led the way in house price inflation with an annual increase of nearly 24%.
Halifax chief economist Martin Ellis says: “Last month's record rise in prices underlines the continuing strength of the UK housing market as the low level of interest rates and falling unemployment drives up demand.”
The bank says the average house price in the UK is now £122,377, while Land Registry figures suggest the figure is just over £146,000. The average price in London, it says, is now just under £250,000.
Halifax says last month's leap in house prices was driven by existing homeowners moving home, who were paying on average 7.8% more for properties than the previous month, whereas prices paid by first-time buyers increased by a much slower 1.5%.
The bank said that the biggest price rises in October were seen in the North, the Humber and the South West, although the mainstream markets of London and the South East continued to experience growth. According to the Land Registry, whose report looks at the three month to September, house price inflation was slowest in the North but even here it reached 18% over the last year.
Both reports are contradictory to the report from Nationwide building society which said last week that property prices had gone up just 1.4% in October, which is said indicated a “tentative” slowdown.
Halifax said that, in the absence of a substantial rise in interest rates or unemployment over the next year, it expects house prices to continue increasing.