Homeowners and property investors have enjoyed a bumper last 12 months as annual house price inflation reached 7.8 per cent in December, according to official figures from the Land Registry.
The typical house in the UK is now expected to cost £173,171 after the considerable increases in 2006 but these gains were not uniform across the UK.
London fuelled the boom with inflation running at 10.4 per cent but homeowners in the north-east did not see such gains as their homes jumped in value by just 4.5 per cent.
The average home in capital now costs £314,550 as demand continued to spiral in 2006, especially from the high influx of new residents from eastern Europe.
In the long term, it appears that the property market is in good health – last year saw prices rise faster than the three previous.
Ed Stansfield of Capital Economics told the Press Association: "Today's figures are no great surprise. It does not give much support for signs of a slow down in the market."
But he added that it was not all rosy as 2007 is looking like the successful year of its predecessor.
"Mortgage lending numbers were weak, and surprisingly weak," he said. "They show that some of the heat is coming out of the market."
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