House price growth rises to 9.7%, says Halifax

English houses in snow Image copyright Thinkstock

House price growth in the UK increased to 9.7% in the year to January, up from 9.5% a month earlier, according to the Halifax.

Britain's largest mortgage lender said the last time that figure was greater was in July 2014, when prices were rising by more than 10%.

Prices increased by 1.7% between December and January.

The Halifax said that the average cost of a house or flat in the UK had now risen to £212,430.

However, rival lender Nationwide has said the annual increase in the year to January was just 4.4%.

"The imbalance between supply and demand continues to exert significant upward pressure on house prices," said Martin Ellis, Halifax's housing economist.

"This situation looks set to persist over the coming months. Further ahead, increasing affordability issues, as price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease."

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IHS Global Insight economist Howard Archer said the market was being supported by "helpful fundamentals, notably including decent real earnings growth, high and rising employment, relatively elevated consumer confidence, and ongoing very low mortgage interest rates."

However he warned that not too much should be read into one set of figures.

Separately, the government announced that 250,000 people - half aged under 30 - have opened Help to Buy ISAs since they launched on 1 December.

The scheme allows first time buyers to save up to £200 a month tax free, to which the government will add 25%.

The maximum government bonus at the end of the plan is £3,000 per person, paid out when the saver buys a property.

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