Average house prices growth accelerated more than expected in December to experience its biggest monthly rise in eight months.
Prices roses 0.8 per cent during December compared to 0.1 per cent in November, according to new figures released by mortgage lender Nationwide. In contrast, economists polled by Reuters had expected a growth of only 0.5 per cent.
Overall house prices rose 4.5 per cent year-on-year, up from a 3.7 per cent annual increase in November.
Robert Gardner chief economist at Nationwide predicted house prices would accelerate at a modest pace, despite the likelihood of interest rate increase from the middle of next year.
South of England and London have outpaced price growth in the rest of the UK by a wide margin. A home in the capital cost 12.3 per cent more in the fourth quarter of 2015 than a year earlier, which means prices are now 50 per cent above the pre-crisis peak in 2007.
Scotland was the only UK region that witnessed a fall in prices, with values down nearly 2 per cent.
In Northern Ireland house prices continue to recover with values rising by 6.5 per cent in the fourth quarter, however they still remain 44 per cent below their pre-crisis peak.
According to Mr Gardner the average house prices are expected to grow a further 3 to 6 per cent nationally over the next twelve months.
“Further healthy gains in employment and rising wages are likely to bolster buyer sentiment, while borrowing costs are expected to rise only gradually,” Mr Gardner said.
The average price of a British house now stands at £196,999, Nationwide said.
Another survey by property website Zoopla found that the average British property is now worth £290,827, up by more than £20,000 on average in 2015.
