House price growth fastest since March 2005

Annual house price growth reached eight per cent in September 2006, bringing the average UK house price to £198,552, according to figures from the Department for Communities and Local Government (DCLG).

This was the fastest pace of growth since March 2005, up from annual house price growth of 7.4 per cent in August and an average house price of £197,009.

London saw particularly sharp levels of annual house price inflation, rising from 7.6 per cent in August to nine per cent in September.

A recent report from the London Housing Association predicted that the average house price in the capital could reach as much as £400,000 in the next five years.

Northern Ireland was the only area of the UK to see a slight reduction in the annual growth rate of house prices in September, with house price growth accelerating in England, Scotland and Wales.

However, house prices in Northern Ireland are still rising faster than anywhere else in the UK, with the average property worth 23.6 per cent more than at the same time last year.