The monthly survey from Hometrack suggests that Britain’s housing market is the strongest it’s been for six years, with the accelerating recovery overshadowing a traditional August slowdown.
Research also suggest low mortgage rates and an improving economic outlook are fuelling property market recovery.
House prices have risen 0.4 percent in August versus 0.3 percent in July – with the South East showing signs of increased growth. London prices have also increased by 0.9 percent in the last month, with the South East climbing 0.5 percent.
The trend is set to continue, with demand (increasing by 1.1 percent) outpacing supply (0.8 percent).
Sellers are now attaining 94.6 percent of their asking price with the average sale falling on average to around two months.
But a new spike in property interest could also put pressure on interest rates despite the Bank of England suggesting they will hold them at present levels (unless there is a sharp spike in inflation). Some analysts believe the Bank could be forced to move sooner as signs of economic recovery appear to be increasing.
The Hometrack figures follow data from the Bank of England showing mortgage approvals have jumped to 60,624 in July from 58,238 the month prior. While this is low when compared to the usual 90,000 a month often seen prior to the bubble burst, approvals are now at their highest levels since then.