British house prices rose 9.7 per cent in January compared with a year earlier, official figures showed today, up from 8.3 per cent year-on-year seen in the previous month.
The data, published by the Office of the Deputy Prime Minister, showed the mid-adjusted average house price in Britain stood at £163,645 in January, up from £162,654 in December. The figures are not seasonally adjusted.
Annual house price inflation in London, which had slipped in recent months, rose to 5 per cent, up from 3.8 per cent in December.
But property prices in Scotland, Wales, the North East and North West as well as Yorkshire posted the biggest gains.
House prices are a closely watched economic indicator in Britain where two-thirds of families own their own homes. Consumer spending has recently been buoyed by the rising value of those properties.
Recent figures from the Halifax bank showed house prices rose less strongly in February than in January, at 1.6 per cent month-on-month compared with 2.3 per cent.
However, the year-on-year growth rate picked up to 17.8 per cent, the highest since last September.
A survey from Nationwide Building Society showed prices rising by 3.1 per cent in February, the strongest monthly increase since April 2002.
The discrepancy between the ODPM and mortgage lenders' figures for year-on-year price rises was down to the slightly different focus of the surveys, said Mr Ed Stansfield, housing economist at Capital Economics.
"The Halifax and the Nationwide measure the price which people put on their mortgage application form - the amount they are trying to borrow, whereas the ODPM try and capture actual completion prices," he said.
Last month the Bank of England raised interest rates for the second time since November, partly to cool the red hot housing market.
But policymakers are concerned to ensure a soft landing in the housing market and not a crash, which was what happened after the last housing boom in the late 1980s.
So far a crash has not appeared likely, even though first-time buyers are increasingly being priced out of the market.